Mega, Lantern sign $48.6M construction loan with Bank of America for 135-unit project in East New York

Mega Contracting Group and Lantern Organization through the entity Euclid Glenmore Housing Dev. Fund Corp. as borrower signed a new construction loan with lender Lantern Organization and Bank of America valued at $52.7 million for the 135-unit development site at 437 Euclid Avenue in East New York, Brooklyn.
The deal closed on June 24, 2022 and was recorded on July 15, 2022. The property has zero square feet of built space and 80,000 square feet of additional air rights for a total buildable of 80,000 square feet according to PincusCo analysis of city data.
The owner bought the property on January 27, 2021, for $6.1 million. The signatory for Mega Contracting Group and Lantern Organization was Hercules Argyriou and Daniel Kent.

The property

The 437 Euclid Avenue parcel has frontage of 190 feet and is 100 feet deep with a total lot size of 20,000 square feet. 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 $475,000.The most recent loan totaled $7 million and was provided by Supportive Housing Solutions Fund on January 27, 2021.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received $2,500 in ECB penalties in the last year.

Development

On these lots, there is one active new building construction project for a 135-unit, 98,361-square-foot R-2 building. The project was developed by William Stein with plans filed June 28, 2019 and it has not been permitted yet.

The neighborhood

In East New York, the bulk, or 40 percent of the 44.6 million square feet of commercial built space are elevator buildings, with industrial buildings next occupying 21 percent of the space. In sales, East New York has the 3rd highest sale turnover among other neighborhoods in the city with $2.6 billion in sales volume in the last two years. For development, East New York has 2.4 times the average amount of major developments relative to other neighborhoods and is the 6th highest in Brooklyn. It had 2.4 million square feet of commercial and multi-family construction under development in the last two years, which represents 5 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other industrial buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of one of the four commercial properties representing zero square feet of the 84,045 square feet. The identified owner is Lantern Community Services. There is one active new building construction project totaling 98,361 square feet. It is a 135-unit, 98,361-square-foot R-2 building developed by William Stein with plans filed June 28, 2019 and permitted July 7, 2022.

The majority, or 72 percent of the 84,045 square feet of built space are office buildings, with specialty buildings next occupying 28 percent of the space.

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