Rabina Properties signs $410M construction loan with Bank OZK for development in Midtown West

Rabina Properties through the entity 520 Fee Owner 2 LLC as borrower signed a new construction loan with lender Bank OZK through the entity Bank Ozk valued at $410 million for the development building at 520 5th Avenue in Midtown West, Manhattan.
The deal closed on March 2, 2022 and was recorded on April 11, 2022. The prior lender was Bank OZK which held debt that had an original loan amount of $109.6 million.

The owner bought the property on July 1, 2019, for $205 million. The signatory for Rabina Properties was Joshua Rabina. The signatory for Bank OZK was Juan Gonzalez. Multi Housing news reported that Christopher Peck, Geoff Goldstein, Evan Pariser, Marko Kazanjian, Alex Staikos and Madison Warwick with JLL Capital Markets represented Rabina. Bank OZK provided a $410 million senior mortgage and Carlyle Group supplied $130 million in mezzanine financing.

The property

The 520 5th Avenue parcel has frontage of 85 feet and is 125 feet deep with a total lot size of 10,625 square feet. The zoning is C5-3 which allows for up to 15 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 $21.5 million.

Violations and lawsuits

The property was not involved in any lawsuits or bankruptcies in the past years. In addition, according to city public data, the property has received $18,030 in ECB penalties and $18,030 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project totaling 582,294 square feet. It is a new building project for a 98-unit, 523,188-square-foot B building developed by Ian Klein with plans filed January 4, 2021 and it has not been permitted yet.

The neighborhood

In Midtown West, the majority, or 69 percent of the 82.2 million square feet of commercial built space are office buildings, with hotel buildings next occupying 13 percent of the space. In sales, Midtown West has the 7th highest sale turnover among other neighborhoods in the city with $1.6 billion in sales volume in the last two years. For development, Midtown West is the 3rd most active neighborhood among other neighborhoods. It had 8.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 10 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 10 of the 69 commercial properties representing 475,156 square feet of the 1,757,875 square feet. The two identified owners are RFR Holding and MCR Development. There are two active new building construction projects totaling 582,294 square feet. The largest is a 98-unit, 523,188-square-foot B building developed by Ian Klein with plans filed January 4, 2021 and it has not been permitted yet. The second largest is a zero-unit, 59,106-square-foot M building developed by Kenneth Cartelli with plans filed June 20, 2012 and it has not been permitted yet.

The majority, or 71 percent of the 1.3 million square feet of built space are office buildings, with hotel buildings next occupying 20 percent of the space.

The borrower

The PincusCo database currently indicates that Rabina Properties owned at least one other commercial property with 63,100 square feet and a city-determined market value of $8.2 million. (Market value is typically about 50% of actual value.) The portfolio has $24 million in debt, borrowed from M&T Bank. The portfolio consists of at least a single residential walkup property. It is located in Brooklyn.

Surrounding

Within a 400-foot radius of 520 5th Avenue, Pincusco identified eight commercial real estate items of interests occurred over the past 24 months.

Of those eight items, two were sales above $5 million totaling $542 million. The most recent of the two was Aurora Capital Associates and Edmond M. Safra which bought two condo units in the 12,125-square-foot, three-unit mixed-use building (RC) on 530 5th Avenue and one other property for $192 million from Brookfield Properties on November 23, 2021.
Of those eight items, five were loans above $5 million totaling $662 million. The most recent of the five was Edmond M. Safra which borrowed $125 million from Signature Bank secured by two condo units in the 12,125-square-foot, three-unit mixed-use building (RC) on 530 5th Avenue on November 23, 2021.

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