Parkoff, others, recap nearly 2K-unit Bronstein portfolio valued at about $290M

The Great Neck-based Parkoff Organization, led by Adam Parkoff, and other unidentified parties recapitalized an approximately 1,880-unit, 41-building Bronstein Properties portfolio in Manhattan, Brooklyn and Queens valued at about $290 million, according to property records and industry sources.
Bronstein Properties, led by Barry Rudofsky, remains in the deal as managing partner and equity holder.

Parkoff and Bronstein are both large multifamily operators. Parkoff in 2020 purchased an approximately 330-unit portfolio from Rubin Schron’s Cammeby’s International Group for $63 million.
A prior equity investor, JP Morgan Chase Asset Management’s Special Situation Property Fund, sold its position, though sources said it remains in the deal through a version of a hope note. A hope note is a common strategy which allows a seller to receive a return if the asset sells or is recapitalized at a later date above a certain level.
The parties executed the overall transaction through a series of entity-level sales for each tax lot, which included two transactions for each property.

In the first part, a stake in the property generally between 10 percent and 30 percent sold from one entity, Bronstein Equities LLC to another, Five Borough Holdings LLC.

In the second transaction for each property, the balance of the interest, typically 90 percent to 70 percent, was sold by 5B Realty Company LLC to Five Borough Holdings LLC. Despite the name implying properties in all of the city’s boroughs, PincusCo only identified properties in Manhattan, Brooklyn and Queens.
Not all of the properties have seen their second sale recorded in city records as of July 5, and so PincusCo projected the total portfolio value based on the partial interests that had been recorded.
The dollar value, unit count and building count calculations are based on a PincusCo analysis of property records and were not confirmed by the parties.
JPMorgan Chase, Parkoff Organization and Bronstein Properties declined to comment.
Sources said the value of the properties, like many workforce housing assets in New York City, has declined over the past few years and may be below the loan value. There were multiple lenders on the portfolio including Capital One and Flagstar Bank and no new debt has been recorded on the properties.

The properties include the 48-unit elevator building (D1) at 2160 Caton Avenue and the 41-unit elevator building (D1) at 2164 Caton Avenue in Flatbush, Brooklyn; the 82-unit walkup building (C1) at 47-12 43rd Avenue in Sunnyside, Queens; the 70-unit elevator building (D1) at 2015-2027 Dorchester Road in Flatbush, Brooklyn; the 33-unit walkup building (C1) at 140-40 Beech Avenue and the 33-unit residential walkup building (C1) at 140-30 Beech Avenue, both in Flushing, Queens; and others.

Prior sales and revenue

Prior to this transaction, PincusCo has no record that the buyer Parkoff Organization had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller Bronstein Properties had not purchased any other properties and sold nine properties in seven transactions for a total of $63 million over the same time period.

The PincusCo database currently indicates that Bronstein Properties owned at least 89 commercial properties with 4,577 residential units in New York City with 4,189,498 square feet and a city-determined market value of $462.2 million. (Market value is typically about 50% of actual value.) The portfolio has $475.7 million in debt, with top three lenders as New York Community Bank, Capital One, and Signature Bank respectively. Within the portfolio, the bulk, or 66 percent of the 4,189,498 square feet of built space are elevator properties, with walkup properties next occupying 33 percent of the space. The bulk, or 47 percent of the built space, is in Queens, with Manhattan next at 29 percent of the space.

The PincusCo database currently indicates that JP Morgan Asset Management owned at least one commercial property in New York City with 898,734 square feet and a city-determined market value of $271.1 million. (Market value is typically about 50% of actual value.) The portfolio consists of at least a single office property. It is located in Manhattan.

The buyer

The PincusCo database currently indicates that Parkoff Organization owned at least 70 commercial properties with 4,254 residential units in New York City with 4,412,198 square feet and a city-determined market value of $434.6 million. (Market value is typically about 50% of actual value.) The portfolio has $624.5 million in debt, with top three lenders as New York Community Bank, Signature Bank, and Esquire Bank respectively. Within the portfolio, the bulk, or 91 percent of the 4,412,198 square feet of built space are elevator properties, with walkup properties next occupying 6 percent of the space. The bulk, or 31 percent of the built space, is in Bronx, with Manhattan next at 30 percent of the space.

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