Madison Realty takes title to HAP dev sites in Washington Heights through bankruptcy, $26.5M transfer

The former lender Madison Realty Capital through the entity 4452 Broadway Owner LLC acquired from HAP Investments through the entity 4452 Broadway Mazal LLC, the partially constructed 129-unit residential elevator building (D7) at 4452 Broadway and the adjacent development parcel (V1) at 44 Fairview Avenue in Washington Heights, Manhattan. The city’s transfer value was $26.5 million, which is often the value of the defaulted loans.
The expected use is ground up development.
The deal closed on July 31, 2024 and was recorded on September 11, 2024. The two properties have 109,528 square feet of built space and 55,783 square feet of additional air rights according to a PincusCo analysis of city data. The sale price per built square foot is $241 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 HAP Investments was Eran Polack. The signatory for Madison Realty Capital was Urian Yap. The contract date was July 31, 2024. Madison Realty Capital is the former lender taking this back in a bankruptcy, through index number 23-11832 Southern District of New York.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Madison Realty Capital purchased 11 properties in six transactions for a total of $309.1 million and sold 14 properties in 11 transactions for a total of $206.1 million over the past 24 months.
The seller HAP Investments had not purchased any other properties and sold one properties in one transaction for a total of $4.1 million over the same time period.

The property

The residential elevator building with 129 residential units in Washington Heights has 109,528 square feet of built space and 55,783 square feet of additional air rights according to a PincusCo analysis of city data. The parcel has frontage of 74 feet and is 100 feet deep with a total lot size of 7,899 square feet. The lot is irregular. The zoning is R7-2 which allows for up to 3.44 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $7.2 million.

Violations and lawsuits

The properties were involved in zero lawsuits and one bankruptcy over the past two years. The bankruptcy was filed on November 16, 2023, by HAP Investments and Nir Amsel citing assets of $48 million. In addition, according to city public data, the properties have received two DOB violations, $1,250 in ECB penalties, and $3,920 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project, 123366302, for a 129-unit, 86,760 square-foot R-2 building. The project was submitted by HAP Investments and filed by Eran Polack with plans filed May 8, 2018 and permitted December 6, 2019.

The block

On the tax block of 4452 Broadway, PincusCo has identified the owners of 43 of the 88 commercial properties representing 1,612,672 square feet of the 2,638,389 square feet. The largest owner is Pinnacle Group, followed by GP Properties and then MP Management.
On the tax block, there were five new building construction projects totaling 242,626 square feet. The largest is a 123-unit, 135,361 square-foot residential (R-2) building submitted by Woody Victor with plans filed October 4, 2017 and it has not been permitted yet. The second largest is a 129-unit, 86,760 square-foot residential (R-2) building submitted by HAP Investments and filed by Eran Polack with plans filed May 8, 2018 and permitted August 20, 2019.

The majority, or 64 percent of the 2.6 million square feet of built space are elevator buildings, with walkup buildings next occupying 31 percent of the space.

The seller

The PincusCo database currently indicates that HAP Investments owned at least three commercial properties with 50 residential units in New York City with 41,002 square feet and a city-determined market value of $22.5 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 100 percent of the 41,002 square feet of built space are elevator properties, with development properties next occupying 0 percent of the space. They are all located in Manhattan.

The buyer

The PincusCo database currently indicates that Madison Realty Capital owned at least 62 commercial properties with 2,490 residential units in New York City with 2,678,402 square feet and a city-determined market value of $382.7 million. (Market value is typically about 50% of actual value.) The portfolio has $1.5 billion in debt, with top three lenders as Signature Bank, MF1 Capital, and Elliott Investment Management respectively. Within the portfolio, the bulk, or 70 percent of the 2,678,402 square feet of built space are elevator properties, with walkup properties next occupying 13 percent of the space. The bulk, or 43 percent of the built space, is in Queens, with Manhattan next at 32 percent of the space.

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