Rabsky Group signs $77M refi loan with G4 Capital Partners for seven properties in Gowanus

Rabsky Group through the entity President Union LLC as borrower signed a refi loan with lender G4 Capital Partners through the entity G4 18231, LLC valued at $77 million for seven properties including the corner industrial building at 383 Carroll Street in Gowanus, Brooklyn, midblock industrial building at 327 Bond Street in Gowanus, Brooklyn, and midblock mixed-use building at 426 President Street in Gowanus, Brooklyn.
The deal closed on May 17, 2022 and was recorded on May 24, 2022. The prior lender was Webster Bank which held debt that had an original loan amount of $52 million. The seven properties have 18,075 square feet of built space and 130,945 square feet of additional air rights for a total buildable of 149,040 square feet according to PincusCo analysis of city data. The loan price per built square foot is $4,260 and the price per buildable square foot is $516 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.

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 383 Carroll Street.

Prior sales and revenue

Out of the seven properties, three with a total of 18,075 square feet of built space generated revenue of $487,591 per year.

The property

The 383 Carroll Street parcel has frontage of 171 feet and is 200 feet deep with a total lot size of 29,620 square feet. The lot is irregular. The zoning is M2-1 which allows for up to 2 times floor area ratio (FAR) for manufacturing. The city-designated market value for the property in 2022 is $1.2 million. The most recent loan totaled $52 million and was provided by Webster Bank on August 12, 2019.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have received $5,000 in ECB penalties and $6,200 in OATH penalties in the last year.

Development

On these lots, there are four active new building construction projects and major alteration projects with initial costs more than $5 million, totaling 545,352 square feet. The largest is a new building project for a 93-unit, 79,896-square-foot R-2 building developed by Rafael Rabinowitz with plans filed February 10, 2022 and it has not been permitted yet. The second largest is a new building project for a 164-unit, 153,506-square-foot R-2 building developed by Rafael Rabinowitz with plans filed January 3, 2022 and it has not been permitted yet.

The neighborhood

In Gowanus, the bulk, or 38 percent of the 11.5 million square feet of commercial built space are industrial buildings, with 1-4 family buildings next occupying 17 percent of the space. In sales, Gowanus has had very little sales volume relative to other neighborhoods with $205.4 million in sales volume in the last two years. For development, Gowanus is the 10th most active neighborhood among other neighborhoods. It had 4.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 35 percent of the neighborhood’s built space.

The block

On the tax block of 383 Carroll Street, PincusCo has identified the owners of three of the five commercial properties representing 17,355 square feet of the 35,533 square feet. The identified owner is Rabsky Group. There are three active new building construction projects totaling 404,703 square feet. The largest is a 298-unit, 273,119-square-foot R-2 building developed by Rafael Rabinowitz with plans filed December 9, 2021 and it has not been permitted yet. The second largest is a 35-unit, 38,831-square-foot R-2 building developed by Rafael Rabinowitz with plans filed February 10, 2022 and it has not been permitted yet.

The majority, or 52 percent of the 35,533 square feet of built space are industrial buildings, with office buildings next occupying 43 percent of the space.

The borrower

The PincusCo database currently indicates that Rabsky Group owned at least 28 commercial properties with 1,524,450 square feet and a city-determined market value of $293.4 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 71 percent of the 1,524,450 square feet of built space are residential elevator properties, with specialty properties next occupying 13 percent of the space. The bulk, or 74 percent of the built space, is in Brooklyn, with Queens next at 26 percent of the space.

Surrounding

Within a 400-foot radius of 383 Carroll Street, PincusCo identified seven commercial real estate items of interests occurred over the past 24 months.
Of those seven items, five were in new building development. There were five new building permit applications. The most recent of these five items was a filing on February 10, 2022 for a 457,854-square-foot R-2 building with 93 residential units at 325 Bond Street.
One of those seven items was a sale which Tavros Capital bought the 25,430-square-foot, one-unit industrial (G2) on 300 Nevins Street for $102 million from Property Markets Group on January 26, 2022.
One of those seven items was a loan which Tavros Capital borrowed $45.9 million from ACORE Capital secured by the 25,430-square-foot, one-unit industrial (G2) on 300 Nevins Street on January 26, 2022.

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