Rabsky Group signs $215M construction loan with Bank Leumi for projects in Williamsburg

Rabsky Group through the entity Harrison Realty LLC as borrower signed a new construction loan with lender Bank Leumi valued at $215 million for five properties including the specialty building at 352 Wallabout Street in Williamsburg, Brooklyn, property at 342 Wallabout Street in Williamsburg, Brooklyn, and property at 330 Wallabout Street in Williamsburg, Brooklyn.
The deal closed on March 8, 2022 and was recorded on March 21, 2022. The prior lender was Bank Leumi which held debt that had an original loan amount of $70.5 million.The five properties have zero square feet of built space and 466,368 square feet of additional air rights for a total buildable of 466,368 square feet according to PincusCo analysis of city data. The loan price per buildable square foot is $461 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 Rabsky Group was Simon Dushinsky. The signatory for Bank Leumi was Roland Cablayan and Roger Rofe.

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 352 Wallabout Street.

The property

The 352 Wallabout Street parcel has frontage of 617 feet and is 200 feet deep with a total lot size of 111,040 square feet. The lot is irregular. The zoning is R7D which allows for up to 4.2 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $3.7 million.The most recent loan totaled $70.5 million and was provided by Bank Leumi on December 30, 2019.

Violations and lawsuits

The properties were not involved in any lawsuits or bankruptcies in the past years. In addition, according to city public data, the properties have received one DOB violation, $10,000 in ECB penalties, and $10,000 in OATH penalties in the last year.

Development

On these lots, there are five active new building construction projects and major alteration projects with initial costs more than $5 million, totaling 790,006 square feet. The largest is a new building project for a 60-unit, 159,119-square-foot R-2 building developed by Rafael Rabinowitz with plans filed April 14, 2021 and it has not been permitted yet. The second largest is a new building project for a 60-unit, 159,119-square-foot R-2 building developed by Rafael Rabinowitz with plans filed May 14, 2021 and it has not been permitted yet.

The neighborhood

In Williamsburg, the bulk, or 35 percent of the 65.1 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 19 percent of the space. In sales, Williamsburg has the 9th highest sale turnover among other neighborhoods in the city with $1.4 billion in sales volume in the last two years. For development, Williamsburg is the 6th most active neighborhood among other neighborhoods. It had 5.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 8 percent of the neighborhood’s built space.

The block

On the tax block of 352 Wallabout Street, PincusCo has identified the owner of the one commercial property that spans that spans zero square feet on the block. The identified owner is Rabsky Group. There are five active new building construction projects totaling 790,006 square feet. The largest is a 60-unit, 159,119-square-foot R-2 building developed by Rafael Rabinowitz with plans filed April 14, 2021 and it has not been permitted yet.The second largest is a 60-unit, 159,119-square-foot R-2 building developed by Rafael Rabinowitz with plans filed May 14, 2021 and it has not been permitted yet.

all properties are specialty.

The borrower

The PincusCo database currently indicates that Rabsky Group owned at least 27 commercial properties with 1,378,150 square feet and a city-determined market value of $280.9 million. (Market value is typically about 50% of actual value.) The portfolio has $969.8 million in debt, with top three lenders as Berkadia Commercial Mortgage, Bank Leumi, and Goldman Sachs respectively. Within the portfolio, the bulk, or 79 percent of the 1,378,150 square feet of built space are residential elevator properties, with specialty properties next occupying 15 percent of the space. The bulk, or 71 percent of the built space, is in Brooklyn, with Queens next at 29 percent of the space.

Surrounding

Within a 400-foot radius of 352 Wallabout Street, Pincusco identified 10 commercial real estate items of interests occurred over the past 24 months.
Of those 10 items, eight were in new building development. There were four new building permit applications and four new building permits. The most recent of these eight items was a permit on April 30, 2021 for a 98,792-square-foot R-2 building with 77 residential units at 34 Union Avenue.
Of those 10 items, two were loans above $5 million totaling $140 million. The most recent of the two was Rabsky Group which borrowed $120 million from Bank Leumi secured by the 0-square-foot development site (V0) on UNION Avenue and three other properties on March 9, 2021.

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