Rabsky Group signs $57M refi loan with Webster Bank for industrial in East Williamsburg

Rabsky Group through the entity 101 Varick II LLC as borrower signed a refi loan with lender Webster Bank valued at $57 million for the industrial building at 101 Varick Avenue in East Williamsburg, Brooklyn.
The deal closed on March 21, 2022 and was recorded on March 30, 2022. The prior lender was Webster Bank which held debt that had an original loan amount of $45.5 million.

The property has 146,300 square feet of built space and 137,607 square feet of additional air rights for a total buildable of 283,726 square feet according to PincusCo analysis of city data. The loan price per built square foot is $389 and the price per buildable square foot is $200 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 owner bought the property on July 21, 2016, for $43.2 million. The signatory for Rabsky Group was Simon Dushinsky. The signatory for Webster Bank was Irina Lovelace. The financing includes $12.08 million in new debt.

Prior sales and revenue

The 146,300-square-foot property generated revenue of $2.4 million or $16 per square foot, according to the most recent income and expense figures.

The property

The 101 Varick Avenue parcel has frontage of 214 feet and is 534 feet deep with a total lot size of 141,863 square feet. The lot is irregular. The zoning is M3-1 which allows for up to 2 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $13.5 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 two DOB violations and $200 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial certificate of occupancy on February 13, 2019. There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The neighborhood

In East Williamsburg, the majority, or 58 percent of the 17.8 million square feet of commercial built space are industrial buildings, with residential walkup buildings next occupying 9 percent of the space. In sales, East Williamsburg has 1.2 times the average sales volume among other neighborhoods with $335.5 million in sales volume in the last two years and is the 12th highest in Brooklyn. For development, East Williamsburg has 1.4 times the average amount of major developments relative to other neighborhoods and is the 15th highest in Brooklyn. It had 1.3 million square feet of commercial and multi-family construction under development in the last two years, which represents 7 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of one of the nine commercial properties representing 100,000 square feet of the 455,285 square feet. The identified owner is Terreno Realty Corporation. There is one active new building construction project totaling 121,899 square feet. It is a 121,899-square-foot F-2 building developed by Adrienne Cooper with plans filed March 19, 2015 and it has not been permitted yet.

The majority, or 100 percent of the 455,285 square feet of built space are industrial buildings, with development buildings next occupying 0 percent of the space.

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 $1.2 billion in debt, with top three lenders as Bank Leumi, Berkadia Commercial Mortgage, 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 101 Varick Avenue, PincusCo identified two commercial real estate items of interests occurred over the past 24 months.
Of those two items, two were sales above $5 million totaling $20.8 million. The most recent of the two was Prologis which bought the 23,900-square-foot industrial (F4) on 512 Johnson Avenue for $14 million from Radutzky family on September 16, 2019.

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