LNR Partners takes title from Thor Equities valued at $25.4M for retail in Little Italy

LNR Partners through the entity Msbam 2012-C6 Broadway, LLC acquired at a value of $25.4 million from Thor Equities through the entity 470 Broadway, LLC, the retail building (K2) at 470 Broadway in Little Italy, Manhattan. LNR was the prior manager for the CMBS loan.
The deal closed on October 14, 2022 and was recorded on October 19, 2022. The property has 6,664 square feet of built space and 10,083 square feet of additional air rights for a total buildable of 16,750 square feet according to PincusCo analysis of city data. The sale price per built square foot is $3,809 and the price per buildable square foot is $1,515 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 seller bought the property on October 15, 2007, for $15.5 million. The signatory for Thor Equities was Morris Missry. The signatory for LNR Partners was Arnold Shulkin. Thor was facing foreclosure through an action filed in October 2021 which PincusCo first reported on at the time. According to a May 2022 payoff statement from LNR, Thor owed $24.4 million on the loan.

Prior sales and revenue

Prior to this transaction, Pincusco has no record that the buyer LNR Partners had purchased any other properties and sold one properties in one transactions for a total of $4 million over the past 24 months.
The seller Thor Equities purchased one properties in one transactions for a total of $78 million and sold 11 properties in nine transactions for a total of $308.5 million over the same time period. The 6,664-square-foot property generated revenue of $2.6 million or $387 per square foot, according to the most recent income and expense figures.

The property

The 470 Broadway parcel has frontage of 33 feet and is 100 feet deep with a total lot size of 3,350 square feet. The zoning is M1-5B which allows for up to 5 times floor area ratio (FAR) for manufacturing The property is in the SoHo-Cast Iron Historic District. The city-designated market value for the property in 2022 is $12.5 million.

Violations and lawsuits

The property was involved in one lawsuit and zero bankruptcies over the past two years. The suit was a $22.9 million commercial foreclosure concerning a loan filed on October 11, 2021, by Morgan Stanley Bank of America Merrill Lynch Trust Series 2012-C6 against Joseph Sitt and Thor Equities. In addition, according to city public data, the property has received $350 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 54,359 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 retail buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of seven of the 26 commercial properties representing 271,543 square feet of the 419,431 square feet. The largest owner is KPG Funds, followed by Himmel + Meringoff Properties and then Vornado Realty Trust.
there are no active new building construction projects on this tax block.

The majority, or 40 percent of the 387,586 square feet of built space are office buildings, with retail buildings next occupying 26 percent of the space.

The seller

The PincusCo database currently indicates that Thor Equities owned at least 48 commercial properties in New York City with 878,951 square feet and a city-determined market value of $245.4 million. (Market value is typically about 50% of actual value.) The portfolio has $192.2 million in debt, with top three lenders as MetLife, Athene Holding, and JPMorgan Chase respectively. Within the portfolio, the bulk, or 37 percent of the 878,951 square feet of built space are elevator properties, with office properties next occupying 34 percent of the space. The bulk, or 71 percent of the built space, is in Manhattan, with Brooklyn next at 29 percent of the space.

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