Meadow Partners, Davean sign $48.8M acquisition loan with Fortress for five properties in East Village

Meadow Partners and Davean Holdings through the entity 163-167 First Avenue Owner LLC as borrower signed a acquisition loan with lender Fortress Investment Group through the entity Fortress Credit Co LLC valued at $48.8 million for five properties including the 24-unit residential walkup building (C7) at 81-83 St Marks Place in East Village, Manhattan, six-unit mixed-use building (S5) at 167 1st Avenue in East Village, Manhattan, and eight-unit residential walkup building (C7) at 165 1st Avenue in East Village, Manhattan.
The deal closed on August 10, 2022 and was recorded on August 31, 2022. The prior lender was Signature Bank which held debt that had an original loan amount of $14 million. The five properties have 54,784 square feet of built space and 4,604 square feet of additional air rights for a total buildable of 57,512 square feet according to PincusCo analysis of city data. The loan price per built square foot is $890 and the price per buildable square foot is $847 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 Meadow Partners was Timothy P. Yantz. The signatory for Fortress Investment Group was Jennifer Sorkin.

Meadow and Davean bought the properties in several transactions, including $18.5 million paid to Fairstead.

Because multiple properties have been transacted, some of the following sections will follow the property with the largest assessed value, which in this case, is the property on 81-83 St Marks Place.

The property

The 81-83 St Marks Place parcel has frontage of 50 feet and is 93 feet deep with a total lot size of 4,696 square feet. The lot is irregular. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $6.1 million.The most recent loan totaled $14 million and was provided by Signature Bank on January 10, 2020.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have received two DOB violations, $625 in ECB penalties, 26 housing violations, and $5,845 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 block

On the tax block of 81-83 St Marks Place, PincusCo has identified the owners of 11 of the 41 commercial properties representing 127,101 square feet of the 386,406 square feet. The largest owner is Fairstead, followed by Organization for Defense of Four Freedoms for Ukraine and then Rita Chou.
There are no active new building construction projects on this tax block.

the majority, or 69 percent of the 386,406 square feet of built space are walkup buildings, with retail buildings next occupying 8 percent of the space.

The borrower

The PincusCo database currently indicates that Meadow Partners owned at least 32 commercial properties in New York City with 1,516,751 square feet and a city-determined market value of $389.1 million. (Market value is typically about 50% of actual value.) The portfolio has $608.1 million in debt, with top three lenders as Deutsche Pfandbriefbank, Fortress Investment Group, and Sterling National Bank respectively. Within the portfolio, the bulk, or 54 percent of the 1,516,751 square feet of built space are office properties, with elevator properties next occupying 12 percent of the space. The bulk, or 52 percent of the built space, is in Manhattan, with Brooklyn next at 48 percent of the space.

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