Residential Management (NY) signs $7.5M refi for 114-unit rental in Morris Heights

Residential Management (NY) through the entity Cm 1571 Undercliff LLC as borrower signed a loan with lender Santander Bank valued at $7.5 million for the 114-unit residential elevator building (D1) at 1571 Undercliff Avenue in Morris Heights, Bronx.
The deal closed on July 26, 2022 and was recorded on August 15, 2022. The property has 132,600 square feet of built space and 129,499 square feet of additional air rights for a total buildable of 262,045 square feet according to PincusCo analysis of city data. The loan price per built square foot is $56 and the price per buildable square foot is $28 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 the borrower was Ezriel Weinberger.

The PincusCo database currently indicates that Residential Management (NY) owned at least 43 commercial properties with 3,061,886 square feet, 2,753 residential units and a city-determined market value of $119.8 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 93 percent of the 3,061,886 square feet of built space are elevator properties, with walkup properties next occupying 6 percent of the space. The bulk, or 79 percent of the built space, is in Bronx, with Manhattan next at 16 percent of the space.

Prior sales and revenue

The owner according to the Department of Housing Preservation and Development is Labe Twerski, head officer. The business entity is Cm 1571 Undercliff Llc. The 132,600-square-foot property generated revenue of $1.5 million or $11 per square foot, according to the most recent income and expense figures.

The property

The 1571 Undercliff Avenue parcel has frontage of 552 feet and is 138 feet deep with a total lot size of 76,176 square feet. The lot is irregular. The zoning is R7-1 which allows for up to 3.44 times floor area ratio (FAR) for residential. The property has a J-51 exemption that started in 1990 and expires in 2024. The city-designated market value for the property in 2022 is $3 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received 97 housing violations, $1,100 in OATH penalties, and three housing litigations in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The block

On this tax block, PincusCo has identified the owners of 11 of the 22 commercial properties representing 1,210,056 square feet of the 1,620,768 square feet. The largest owner is Hudson Valley Property Group, followed by Residential Management (NY) and then Yechiel Newhouse.
There are four active new building construction projects totaling 79,886 square feet. The largest is a 66-unit, 43,688-square-foot R-2 building developed by Jay Martino with plans filed April 1, 2020 and it has not been permitted yet.The second largest is a 56-unit, 3,709-square-foot R-2 building developed by Chaim Schwartz with plans filed May 22, 2022 and it has not been permitted yet.

The majority, or 100 percent of the 1.6 million square feet of built space are elevator buildings.

Surrounding

Within a 400-foot radius of 1571 Undercliff Avenue, Pincusco identified three commercial real estate items of interests occurred over the past 24 months.
One of those three items was a sale which Hudson Valley Property Group bought the 416,144-square-foot, 768-unit rental (D7) on 1600 Sedgwick Avenue for $115 million from Treetop Development on January 15, 2021.
Of those three items, two were loans above $5 million totaling $24 million. The most recent of the two was Blackshore Realty Group which borrowed $16 million from New York Community Bank secured by the 182,800-square-foot, 151-unit rental (D9) on 1590 Undercliff Avenue on May 12, 2022.

Direct link to Acris document. link