Lam Group signs $22.5M refi loan with Shanghai Commercial Bank for office in Little Italy

Lam Group through the entity Centre Hester Realty, LLC as borrower signed a refi loan with lender Shanghai Commercial Bank through the entity Shanghai Commercial Bank Ltd., New York Branch valued at $22.5 million for the office building (O5) at 202 Centre Street in Little Italy, Manhattan.
The deal closed on August 19, 2022 and was recorded on September 13, 2022. The prior lender was Wells Fargo which held debt that had an original loan amount of $12.7 million. The property has 39,000 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $576 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The signatory for Lam Group was Kin Chung Lam. The signatory for Shanghai Commercial Bank was Timothy Chan and Nim Chi Lau.

Prior sales and revenue

The 39,000-square-foot property generated revenue of $2 million or $50 per square foot, according to the most recent income and expense figures.

The property

The 202 Centre Street parcel has frontage of 35 feet and is 110 feet deep with a total lot size of 6,445 square feet. The lot is irregular. The zoning is M1-5B which allows for up to 5 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $8.2 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received one DOB violation and $2,450 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The neighborhood

In Little Italy, the bulk, or 33 percent of the 4.1 million square feet of commercial built space are office buildings, with walkup buildings next occupying 25 percent of the space. In sales, Little Italy has had very little sales volume relative to other neighborhoods with $109.7 million in sales volume in the last two years. For development, Little Italy has had very little major development activity relative to other neighborhoods.It had 59,359 square feet of commercial and multi-family construction under development in the last two years, which represents 1 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of one of the 15 commercial properties representing 13,300 square feet of the 173,901 square feet. The identified owner is Kow Quen Realty Corp..
There are no active new building construction projects on this tax block.

The majority, or 60 percent of the 170,344 square feet of built space are office buildings, with mixed-use buildings next occupying 31 percent of the space.

The borrower

The PincusCo database currently indicates that Lam Group owned at least five commercial properties in New York City with 1,127,136 square feet and a city-determined market value of $304.7 million. (Market value is typically about 50% of actual value.) The portfolio has $134.5 million in debt, with top three lenders as Investors Bank, Shanghai Commercial Bank, and Flushing Bank respectively. Within the portfolio, the bulk, or 65 percent of the 1,127,136 square feet of built space are hotel properties, with elevator properties next occupying 35 percent of the space. The bulk, or 95 percent of the built space, is in Manhattan, with Brooklyn next at 5 percent of the space.

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