Maddd, Joy Construction sign $143M construction loan for 465-unit development in Downtown Brooklyn

Maddd Equities and Joy Construction through the entity Brooklyn Red Sauce LLC as borrower signed a new construction loan with lender Valley National Bank valued at $143 million for the 465-unit development at 67 Prince Street also known as 202 Tillary Street in Downtown Brooklyn.
The deal closed on May 8, 2023 and was recorded on May 18, 2023. The prior lender was Valley National Bank which held debt that had an original loan amount of $30 million.

On the lot, there is one active new building construction project for a 465-unit, 389,226 square-foot R-2 building. The project was submitted by Joy Construction and filed by Eli Weiss with plans filed July 9, 2021.
The developers control the property through a ground lease. The signatory for Maddd Equities and Joy Construction was Eli Weiss. The signatory for Valley National Bank was Victor Brown.

The property

The parcel has frontage of 87 feet and is 85 feet deep with a total lot size of 25,481 square feet. The lot is irregular. The zoning is C6-4 which allows for up to 10 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $10.7 million. The most recent loan totaled $30 million and was provided by Bank Leumi on November 12, 2021.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received two DOB violations, $57,400 in ECB penalties, and $57,400 in OATH penalties in the last year.

The neighborhood

In Downtown Brooklyn, The bulk, or 40 percent of the 22.4 million square feet of commercial built space are office buildings, with elevator buildings next occupying 24 percent of the space. In sales, Downtown Brooklyn has 3.7 times the average sales volume among other neighborhoods with $1.3 billion in sales volume in the last two years and is the 2nd highest in Brooklyn. For development, Downtown Brooklyn has 3.6 times the average amount of major developments relative to other neighborhoods and is the 4th highest in Brooklyn. It had 3.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 16 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of two of the two commercial properties representing 761,970 square feet of the 761,970 square feet. The two identified owners are New York City Housing Authority and Joy Construction.
On the tax block, there was one new building construction project filed totaling 389,226 square feet. It is a 465-unit, 389,226 square-foot residential (R-2) building submitted by Joy Construction and filed by Eli Weiss with plans filed July 9, 2021 and permitted June 3, 2022.

The majority, or 85 percent of the 761,970 square feet of built space are elevator buildings, with development buildings next occupying 15 percent of the space.

The borrower

The PincusCo database currently indicates that Maddd Equities owned at least 14 commercial properties with 22 residential units in New York City with 676,754 square feet and a city-determined market value of $163.1 million. (Market value is typically about 50% of actual value.) The portfolio has $211.9 million in debt, with top three lenders as NYC Housing Development Corporation, Sterling National Bank, and Metropolitan Commercial Bank respectively. Within the portfolio, the bulk, or 44 percent of the 676,754 square feet of built space are office properties, with W3 properties next occupying 22 percent of the space. The bulk, or 68 percent of the built space, is in Bronx, with Manhattan next at 32 percent of the space.
The PincusCo database currently indicates that Joy Construction owned at least six commercial properties with 186 residential units in New York City with 414,829 square feet and a city-determined market value of $133.9 million. (Market value is typically about 50% of actual value.) The portfolio has $127 million in debt, borrowed from Natixis and Bank Leumi. Within the portfolio, the bulk, or 43 percent of the 414,829 square feet of built space are elevator properties, with hotel properties next occupying 29 percent of the space. The bulk, or 72 percent of the built space, is in Manhattan, with Brooklyn next at 28 percent of the space.

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