Related Companies signs $430.8M construction loan for development in Willets Point

Related Companies through the entity Willets Point Phase I Housing Development Fund as borrower signed a new construction loan with lender NYC Housing Development Corporation valued at $430.8 million for three parcel development site at 126-20 Willets Point Boulevard in Willets Point, Queens.
On these lots, there are two active new building construction projects and major alteration projects with initial costs more than $5 million, totaling 850,233 square feet. The largest is a new building project for a 534-unit, 521,402 square-foot R-2 building submitted by Related Companies and filed by Frank Monterisi with plans filed November 3, 2022 and it has not been permitted yet. The second largest is a new building project for a 347-unit, 328,831 square-foot R-2 building submitted by Related Companies and filed by Frank Monterisi with plans filed November 3, 2022 and it has not been permitted yet.
The deal closed on November 21, 2023 and was recorded on December 6, 2023. The three properties have zero square feet of built space and 356,724 square feet of additional air rights for a total buildable of 356,724 square feet according to a PincusCo analysis of city data. The loan price per built square foot is $N/A and the price per buildable square foot is $1,207 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 Related Companies was Frank Monterisi.

The property

The parcel has frontage of 281 feet and is 199 feet deep with a total lot size of 103,699 square feet. The lot is irregular. The zoning is C4-4 which allows for up to 3.4 times floor area ratio (FAR) for commercial and up to 3.44 times FAR for residential. The city-designated market value for the property in 2022 is $2.1 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have received $275 in OATH penalties in the last year.

The neighborhood

In Willets Point, The majority, or 75 percent of the 834,702 square feet of commercial built space are industrial buildings, with specialty buildings next occupying 19 percent of the space. In sales, Willets Point has not had any sales in the last two years. For development, Willets Point has had very little major development activity relative to other neighborhoods.It had 8,896 square feet of commercial and multi-family construction under development in the last two years, which represents 1 percent of the neighborhood’s built space.

The block

On the tax block of 126-20 Willets Point Blvd, PincusCo has identified the owners of six of the 35 commercial properties representing 109,200 square feet of the 246,205 square feet. The largest owner is NYC Department Of Housing Preservation And Development, followed by Neil G. Soni and then Lirr.
On the tax block, there were two new building construction projects totaling 850,233 square feet. The largest is a 534-unit, 521,402 square-foot residential (R-2) building submitted by Related Companies and filed by Frank Monterisi with plans filed November 3, 2022 and it has not been permitted yet. The second largest is a 347-unit, 328,831 square-foot residential (R-2) building submitted by Related Companies and filed by Frank Monterisi with plans filed November 3, 2022 and it has not been permitted yet.

The majority, or 99 percent of the 246,205 square feet of built space are industrial buildings, with retail buildings next occupying 1 percent of the space.

The borrower

The PincusCo database currently indicates that Related Companies owned at least 177 commercial properties with 9,555 residential units in New York City with 21,530,381 square feet and a city-determined market value of $6 billion. (Market value is typically about 50% of actual value.) The portfolio has $4.7 billion in debt, with top three lenders as Wells Fargo, Carlyle Group, and Deutsche Bank respectively. Within the portfolio, the bulk, or 45 percent of the 21,530,381 square feet of built space are elevator properties, with office properties next occupying 30 percent of the space. The bulk, or 60 percent of the built space, is in Manhattan, with Bronx next at 24 percent of the space.

Direct link to Acris document. link