REEC signs $60.5M land loan with Raven Capital for 72K sf dev project in Nolita

Real Estate Equities Corporation through the entity REEC 156 Bowery LLC as borrower signed a $60.5 million initial land loan with lender Raven Capital Management, which also uses the name Raven & Company, through the entity Raven Asset-Based Credit Fund I LP, that covers seven contiguous tax lots with properties including the three-unit mixed-use building (K4) at 164 Bowery in Nolita, Manhattan, three-unit mixed-use building (K4) at 162 Bowery in Nolita, Manhattan, and two-unit mixed-use building (K4) at 166 Bowery in Nolita, Manhattan.
REEC is the ground tenant, having signed a 99-year ground lease in 2020 valued at $50 million with landlord, Kinsmen Property Group.
On April 21, 2022, REEC filed plans with the Department of Buildings for the construction of a 72,441-square-foot mixed-use commercial building with an address of 156 Bowery. Brandon Klein, VP of Real Estate Equities Corporation, filed the plans. The plans call for the construction of an 85-foot-tall, seven-story building and were filed with the New York City Department of Buildings under job number M00703761.

The loan deal closed on August 31, 2022, and was recorded on September 19, 2022. The signatory for Real Estate Equities Corporation was managing partner Mark A. Seigel.

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 $650 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 72,441-square-foot office (B) building. The project was submitted by Brandon Klein with plans filed April 21, 2022 and it has not been permitted yet.

The neighborhood

In Nolita, the bulk, or 49 percent of the 3.1 million square feet of commercial built space are walkup buildings, with elevator buildings next occupying 21 percent of the space. In sales, Nolita has had very little sales volume relative to other neighborhoods with $111.7 million in sales volume in the last two years. For development, Nolita has had very little major development activity relative to other neighborhoods.It had 76,039 square feet of commercial and multi-family construction under development in the last two years, which represents 2 percent of the neighborhood’s built space.

The block

On the tax block of 156 Bowery, PincusCo has identified the owners of 13 of the 33 commercial properties representing 96,254 square feet of the 198,061 square feet. The largest owner is Real Estate Equities Corporation, followed by Janet Giaimo Vitale and then Ping Cheung.
There is one active new building construction project, which is the REEC project filed in April 2022.

The majority, or 58 percent of the 174,675 square feet of built space are mixed-use buildings, with walkup buildings next occupying 40 percent of the space.

The borrower

The PincusCo database currently indicates that Real Estate Equities Corporation owned at least 10 commercial properties in New York City with 43,803 square feet. The portfolio has $118 million in debt, borrowed from Parkview Financial and Heritage Capital Management. Within the portfolio, the bulk, or 100 percent of the 43,803 square feet of built space are mixed-use properties, with development properties next occupying 0 percent of the space. They are all located in Manhattan.

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