Rockrose signs $240M construction loan with Wells Fargo for 609-unit project in Fort Greene

Rockrose Development through the entity Ashland Dekalb LLC as borrower signed a new construction loan with lender Wells Fargo valued at $240 million for the 609-unit rental development at 180 Ashland Place in Fort Greene, Brooklyn.
The deal closed on May 4, 2022 and was recorded on May 18, 2022.
The owner bought the property on April 16, 2020, for $62 million. The signatory for Rockrose Development was Richard A. Brancato. Commercial Observer first reported the financing deal.

The property

The 180 Ashland Place parcel has frontage of 150 feet and is 100 feet deep with a total lot size of 16,600 square feet. The lot is irregular. The zoning is C6-4 which allows for up to 10 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $5.1 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 $2,500 in ECB penalties and $4,500 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 609-unit, 418,092-square-foot R-2 building. The project was developed by Justin Elghanayan with plans filed April 20, 2020 and it has not been permitted yet.

The neighborhood

In Fort Greene, the bulk, or 28 percent of the 17.9 million square feet of commercial built space are residential elevator buildings, with 1-4 family buildings next occupying 22 percent of the space. In sales, Fort Greene has had very little sales volume relative to other neighborhoods with $221.3 million in sales volume in the last two years. For development, Fort Greene has 2.3 times the average amount of major developments relative to other neighborhoods and is the 9th highest in Brooklyn. It had 2.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 12 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of seven of the 14 commercial properties representing 143,795 square feet of the 287,059 square feet. The largest owner is City of New York, followed by Rockrose Development and then Victor Reyes. There are two active new building construction projects totaling 533,413 square feet. The largest is a 609-unit, 418,092-square-foot R-2 building developed by Justin Elghanayan with plans filed April 20, 2020 and it has not been permitted yet. The second largest is a 147-unit, 115,321-square-foot R-2 building developed by Chesky Rosen with plans filed February 2, 2022 and it has not been permitted yet.

The majority, or 58 percent of the 285,531 square feet of built space are specialty buildings, with industrial buildings next occupying 22 percent of the space.

The borrower

The PincusCo database currently indicates that Rockrose Development owned at least 22 commercial properties with 5,344,631 square feet and a city-determined market value of $1.4 billion. (Market value is typically about 50% of actual value.) The portfolio has $1.3 billion in debt, with top three lenders as Wells Fargo, MetLife, and Deutsche Pfandbriefbank respectively. Within the portfolio, the bulk, or 89 percent of the 5,344,631 square feet of built space are residential elevator properties, with office properties next occupying 10 percent of the space. The bulk, or 42 percent of the built space, is in Manhattan, with Queens next at 40 percent of the space.

Surrounding

Within a 400-foot radius of 180 Ashland Place, PincusCo identified five commercial real estate items of interests occurred over the past 24 months.
Of those five items, two were in new building development. There were two new building permit applications. The most recent of these two items was a filing on February 2, 2022 for a 100,652-square-foot R-2 building with 147 residential units at 27 Rockwell Place.
Of those five items, three were loans above $5 million totaling $343.2 million. The most recent of the three was Brooklyn Hospital Center which borrowed $52.5 million from MidCap Financial secured by the 0-square-foot industrial (G6) on 161 Ashland Place on October 19, 2021.

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