Rockrose pays $65M to Madison Realty for dev site in Cobble Hill

Rockrose Development through the entity 91 Pacific L.L.C. paid $65 million to Madison Realty Capital through the entity Pacific Hicks Owner 2 LLC for the development site at 67-105 Pacific Street in Cobble Hill, Brooklyn. The expected use is ground up development. This is a “real estate owned” sale, in that Madison Realty Capital was the former lender and it took the property back from former borrower Fortis Property Group. Fortis bought this property as part of a $240 million purchase in 2015 from the Long Island College Hospital.

The Real Deal first reported on the transaction after it went into contract.
The deal closed on August 16, 2024 and was recorded on August 30, 2024. The property has 155,198 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $418 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.)
Madison Realty Capital took the property back on October 20, 2022. Fortis had borrowed . The signatory for Madison Realty Capital was Urian Yap. The signatory for Rockrose Development was Patricia Dunphy. The contract date was July 26, 2024.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Rockrose Development purchased 10 properties in six transactions for a total of $188.8 million and sold four properties in four transactions for a total of $94 million over the past 24 months.
The seller Madison Realty Capital purchased 11 properties in six transactions for a total of $309.1 million and sold 15 properties in 11 transactions for a total of $149.3 million over the same time period. The 155,198-square-foot property generated revenue of $8.1 million or $52 per square foot, according to the most recent income and expense figures.

The property

The residential elevator building with 102 residential units in Cobble Hill has 155,198 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 230 feet and is 264 feet deep with a total lot size of 33,107 square feet. The lot is irregular. The zoning is R6 which allows for up to 2.43 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $10.9 million. The most recent loan totaled $76.9 million and was provided by Apollo Global Management|Athene Annuity|Athora Holding on October 20, 2022.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received four DOB violations in the last year.

Development

On the lot, there are two active new building construction projects and major alteration projects with initial costs more than $5 million, totaling 911,696 square feet. The largest, 321189717, is a new building project for a 102-unit, 567,748 square-foot R-2 building submitted by Fortis Property Group and filed by Akiva Kobre with plans filed December 22, 2016 and permitted November 9, 2017. The second largest, 320908559, is a new building project for a 343,948 square-foot B building submitted by NYU Langone Health and filed by Beau Everett with plans filed July 31, 2015 and permitted July 14, 2022. On the tax lot, the most recent condominium plan was filed by FPG CH 91 PACIFIC, LLC** to create 103 residential units in a building at 91 Pacific Street in Cobble Hill, Brooklyn, called 2 River Park Condominium that has a $241.4 million sellout, according to an January 23, 2018 submission to the New York State Attorney General.

The block

On this tax block, PincusCo has identified the owners of six of the eight commercial properties representing 220,395 square feet of the 231,885 square feet. The largest owner is Madison Realty Capital, followed by Marc S. Shore and then Highpoint Property Group.
On the tax block, there were two new building construction projects totaling 911,696 square feet. The largest is a 102-unit, 567,748 square-foot residential (R-2) building submitted by Fortis Property Group and filed by Akiva Kobre with plans filed December 22, 2016 and permitted November 9, 2017. The second largest is a 343,948 square-foot business (B) building submitted by NYU Langone Health and filed by Beau Everett with plans filed July 31, 2015 and permitted April 24, 2019.

The majority, or 67 percent of the 231,885 square feet of built space are elevator buildings, with walkup buildings next occupying 33 percent of the space.

The seller

The PincusCo database currently indicates that Madison Realty Capital owned at least 63 commercial properties with 2,592 residential units in New York City with 2,833,600 square feet and a city-determined market value of $393.6 million. (Market value is typically about 50% of actual value.) The portfolio has $1.5 billion in debt, with top three lenders as Signature Bank, MF1 Capital, and Elliott Investment Management respectively. Within the portfolio, the bulk, or 72 percent of the 2,833,600 square feet of built space are elevator properties, with walkup properties next occupying 13 percent of the space. The bulk, or 41 percent of the built space, is in Queens, with Manhattan next at 30 percent of the space.

The buyer

The PincusCo database currently indicates that Rockrose Development owned at least 32 commercial properties with 5,562 residential units in New York City with 6,291,407 square feet and a city-determined market value of $1.6 billion. (Market value is typically about 50% of actual value.) The portfolio has $2.1 billion in debt, with top three lenders as Wells Fargo, MetLife, and Deutsche Pfandbriefbank respectively. Within the portfolio, the bulk, or 72 percent of the 6,291,407 square feet of built space are elevator properties, with D4 properties next occupying 14 percent of the space. The bulk, or 43 percent of the built space, is in Manhattan, with Queens next at 37 percent of the space.

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