RW Real Estate signs $24M construction loan for 58-unit Crown Heights project

RW Real Estate Group through the entity Rw 705 Franklin LLC as borrower signed a construction loan with lender Provident Bank valued at $24 million for the 58-unit development at 705-711 Franklin Avenue in Crown Heights, Brooklyn.

On the lot, there is one active new building construction project for a 58-unit, 47,094 square-foot residential (R-2) building. The project was submitted by RW Real Estate Group and filed by Oren Sauberman with plans filed February 25, 2022 and permitted May 31, 2022.

The deal closed on February 27, 2024 and was recorded on March 20, 2024. The prior lender was Blackstone Group which held debt that had an original loan amount of $6 million.
The loan price per buildable square foot is $510 per the PincusCo analysis.
The owner bought the property on January 6, 2016, for $12 million. The signatory for RW Real Estate Group was William Green. William Green is general counsel for both RW Real Estate and Laundry Capital.

The property

The parcel has frontage of 102 feet and is 100 feet deep with a total lot size of 10,250 square feet. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $1.1 million. The most recent loan totaled $6 million and was provided by Signature Bank on January 1, 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 $7,500 in ECB penalties and $8,450 in OATH penalties in the last year.

The neighborhood

In Crown Heights, The bulk, or 39 percent of the 46.5 million square feet of commercial built space are walkup buildings, with elevator buildings next occupying 36 percent of the space. In sales, Crown Heights has 1.8 times the average sales volume among other neighborhoods with $534.3 million in sales volume in the last two years and is the 13th highest in Brooklyn. For development, Crown Heights has 2.3 times the average amount of major developments relative to other neighborhoods and is the 5th highest in Brooklyn. It had 2.3 million square feet of commercial and multi-family construction under development in the last two years, which represents 5 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 15 of the 18 commercial properties representing 151,003 square feet of the 160,771 square feet. The largest owner is Workforce Housing Group, followed by Vikas Ghai and then Serge Faroul.
On the tax block, there were two new building construction projects totaling 54,378 square feet. The largest is a 58-unit, 47,094 square-foot residential (R-2) building submitted by RW Real Estate Group and filed by Oren Sauberman with plans filed February 25, 2022 and permitted May 31, 2022. The second largest is a eight-unit, 7,284 square-foot residential (R-2) building submitted by David Manesh with plans filed January 23, 2019 and permitted June 28, 2021.

The majority, or 87 percent of the 160,771 square feet of built space are walkup buildings, with mixed-use buildings next occupying 8 percent of the space.

The borrower

The PincusCo database currently indicates that RW Real Estate Group owned at least three commercial properties in New York City with 15,919 square feet and a city-determined market value of $2.7 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 50 percent of the 15,919 square feet of built space are development properties, with retail properties next occupying 50 percent of the space. The bulk, or 50 percent of the built space, is in Bronx, with Brooklyn next at 50 percent of the space.

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