Lender BLDG acquires office properties in Williamsburg from Cayuga for $26.9M

BLDG Management through the entity BLDG 87 Wythe LLC acquired from Cayuga Capital Management through the entity 87 Wythe Holding LLC the office building (O5) at 97 North 10th Street and the office building (O1) at 79 North 10th Street in Williamsburg, Brooklyn. The expected use is cash flowing. The transfer price was $26.9 million, just above the debt level.
In 2018, M&T Bank provided a $24.5 million loan, and BLDG Management a $4 million loan. The loans fell into default several years ago. The sale price is $368,311 above the outstanding debt. Furthermore, the remaining principal of $3.86 million owed to BLDG Management of the original $4 million was assigned after the sale, to a BLDG affiliate called BLDG Funding. This is not described in transfer documents as a deed-in-lieu of foreclosure, but has the characteristics of one, in which the former owner is in default and hands the property over to a lender.
The deal closed on November 14, 2024 and was recorded on December 2, 2024. The two properties have 35,068 square feet of built space and 10,225 square feet of additional air rights for a total buildable of 45,262 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $767 and the price per buildable square foot is $594 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 Cayuga Capital Management was Jacob L. Sacks. The signatory for BLDG Management was Lloyd Goldman. The contract date was November 14, 2024.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer BLDG Management purchased 11 properties in three transactions for a total of $230.5 million and has no record it sold any properties over the past 24 months.
The seller Cayuga Capital Management purchased one property in one transaction for a total of $24.8 million and sold three properties in three transactions for a total of $60 million over the same time period. The two properties with a total of 35,068 square feet of built space generated revenue of $1.2 million per year or $34 per square foot. The sale price per square foot was $768.

The property

The office buildings in Williamsburg have 35,068 square feet of built space and 10,225 square feet of additional air rights for a total buildable of 45,262 square feet according to a PincusCo analysis of city data. The parcel has frontage of 1,145 feet and is 200 feet deep with a total lot size of 18,516 square feet. The lot is irregular. The zoning is M1-2 which allows for up to 2 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $5.2 million. The most recent loan totaled $28.3 million and was provided by M&T Bank on June 29, 2021.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have received $300 in OATH penalties in the last year.

Development

For the tax lot buildings, two out of the two buildings received a initial certificate of occupancy in the last ten years. On these lots, there is one active new building construction project, B01084172, for a 88,680 square-foot 69 building. The project was submitted by Double U Development and filed by Michael Weitzman with plans filed August 6, 2024 and it has not been permitted yet.

The neighborhood

In Williamsburg, The bulk, or 39 percent of the 50.4 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 25 percent of the space. In sales, Williamsburg has the 5th highest sale turnover among other neighborhoods in the city with $1.9 billion in sales volume in the last two years. For development, Williamsburg is the 10th most active neighborhood among other neighborhoods. It had 4.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 9 percent of the neighborhood’s built space.

The block

On the tax block of 97 North 10th Street, PincusCo has identified the owners of three of the three commercial properties representing 36,928 square feet of the 36,928 square feet. The two identified owners are Cayuga Capital Management and Double U Realty.
On the tax block, there was one new building construction project filed totaling 88,680 square feet. It is a 88,680 square-foot 69 building submitted by Double U Development and filed by Michael Weitzman with plans filed August 6, 2024 and it has not been permitted yet.

The majority, or 95 percent of the 36,928 square feet of built space are office buildings, with retail buildings next occupying 5 percent of the space.

The seller

The PincusCo database currently indicates that Cayuga Capital Management owned at least 27 commercial properties with 215 residential units in New York City with 241,940 square feet and a city-determined market value of $45.7 million. (Market value is typically about 50% of actual value.) The portfolio has $148.6 million in debt, with top three lenders as M&T Bank, Amherst Capital Management, and BLDG Management respectively. Within the portfolio, the bulk, or 43 percent of the 241,940 square feet of built space are walkup properties, with D7 properties next occupying 26 percent of the space. The bulk, or 96 percent of the built space, is in Brooklyn, with Queens next at 4 percent of the space.

The buyer

The PincusCo database currently indicates that Bldg Management owned at least 170 commercial properties with 4,709 residential units in New York City with 5,999,674 square feet and a city-determined market value of $1.6 billion. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 54 percent of the 5,999,674 square feet of built space are elevator properties, with office properties next occupying 18 percent of the space. The bulk, or 78 percent of the built space, is in Manhattan, with Queens next at 11 percent of the space.

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