Rivington Company signs $62.5M construction loan with Post Road, American Life, GT Partners for Bedford Stuyvesant development

Rivington Company through the entity Myrtle 773 Owner LLC as borrower signed a new construction loan with lender Post Road Group, American Life & Security, and GT Partners and others through the entity Post Road Real Estate Finance LLC valued at $62.5 million for a development site with six parcels including the industrial building (G9) at 122 Sandford Street in Bedford Stuyvesant, Brooklyn, development building (V1) at 723 Myrtle Avenue in Bedford Stuyvesant, Brooklyn, and development building (V1) at 733 Myrtle Avenue in Bedford Stuyvesant, Brooklyn.
The deal closed on December 21, 2022 and was recorded on January 5, 2023.The six properties have 1,500 square feet of built space and 66,401 square feet of additional air rights for a total buildable of 67,901 square feet according to PincusCo analysis of city data. The loan price per built square foot is $41,666 and the price per buildable square foot is $920 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 Rivington Company was John Travis Stabler. The signatory for Post Road Group, American Life & Security, and GT Partners was Jason Carney and Adam Nadborny.

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 723 Myrtle Avenue.

The property

The 723 Myrtle Avenue parcel has frontage of 66 feet and is 100 feet deep with a total lot size of 6,667 square feet. The zoning is R7D which allows for up to 4.2 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $312,000.

Violations and lawsuits

The properties were involved in one lawsuit and zero bankruptcies over the past two years. The suit was a $1 million judgment concerning a nuisance filed on June 23, 2022, by City of New York against Rivington Company. In addition, according to city public data, the properties have received $6,250 in ECB penalties and $6,250 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 132-unit, 102,412 square-foot R-2 building. The project was developed by Yaniv Cohen with plans filed February 12, 2020.

The neighborhood

In Bedford Stuyvesant, the bulk, or 34 percent of the 53.8 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 30 percent of the space. In sales, Bedford Stuyvesant has 2.3 times the average sales volume among other neighborhoods with $822.6 million in sales volume in the last two years and is the 5th highest in Brooklyn. For development, Bedford Stuyvesant has 3.8 times the average amount of major developments relative to other neighborhoods and is the 4th highest in Brooklyn. It had 4 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. There was one pre-foreclosure suit filed among other development buildings in the past 12 months.

The block

On the tax block of 723 Myrtle Avenue, PincusCo has identified the owners of 11 of the 30 commercial properties representing 50,136 square feet of the 160,373 square feet. The largest owner is Shlomo Moskovits, followed by Shloma Stuhl and then Rivington Company.
On the tax block, there were two new building construction projects totaling 104,162 square feet. The largest is a 132-unit, 102,412-square-foot R-2 building developed by Yaniv Cohen with plans filed February 12, 2020 and permitted June 1, 2022. The second largest is a zero-unit, 1,750-square-foot S-2 building developed by Saul Wolf with plans filed August 3, 2021 and it has not been permitted yet.

The majority, or 56 percent of the 156,595 square feet of built space are specialty buildings, with industrial buildings next occupying 23 percent of the space.

The borrower

The PincusCo database currently indicates that Rivington Company owned at least 10 commercial properties in New York City with 76,019 square feet and a city-determined market value of $10.8 million. (Market value is typically about 50% of actual value.) The portfolio has $64.5 million in debt, with top three lenders as Red Fox Capital, Post Road Group, and TNW 601 THROOP LLC respectively. Within the portfolio, the bulk, or 44 percent of the 76,019 square feet of built space are office properties, with M1 properties next occupying 35 percent of the space. They are all located in Brooklyn.

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