Storage Post pays $61M to Keepers Self Storage for industrial in Alphabet City

Storage Post through the entity Storage Post/444 East 10th Street, LLC paid $61 million to Keepers Self Storage through the entity 444 Warehouse Associates, L.P. for the midblock industrial building at 444 East 10th Street in Alphabet City, Manhattan.
The deal closed on April 25, 2022 and was recorded on May 18, 2022. The property has 92,470 square feet of built space according to PincusCo analysis of city data. The sale price per built square foot is $659 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 Keepers Self Storage was Arthur H. Lerner. The signatory for Storage Post was William A. Palmer III. This is the ninth acquisition for Storage Post, the company announced in a press release. 

Prior sales and revenue

Prior to this transaction, Pincusco has records that the buyer Storage Post purchased three properties in two transactions for a total of $115 million and has no record it sold any properties over the past 24 months.
The seller Keepers Self Storage had not purchased any other properties and had not sold any properties over the same time period. The 92,470-square-foot property generated revenue of $2.2 million or $24 per square foot, according to the most recent income and expense figures.

The property

The 444 East 10th Street parcel has frontage of 148 feet and is 92 feet deep with a total lot size of 13,210 square feet. The lot is irregular. The zoning is R8B which allows for up to 4 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $12 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 one DOB violation, $640 in ECB penalties, and $640 in OATH penalties 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 neighborhood

In Alphabet City, the majority, or 52 percent of the 15.7 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 27 percent of the space. In sales, Alphabet City has had very little sales volume relative to other neighborhoods with $113.8 million in sales volume in the last two years. For development, Alphabet City has had very little major development activity relative to other neighborhoods. It had 185,104 square feet of commercial and multi-family construction under development in the last two years, which represents 1 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of two of the 16 commercial properties representing 25,477 square feet of the 320,830 square feet. The two identified owners are Richard Young and GP Properties. There are no active new building construction projects on this tax block.

The majority, or 34 percent of the 434,355 square feet of built space are residential elevator buildings, with industrial buildings next occupying 22 percent of the space.

The buyer

The PincusCo database currently indicates that Storage Post owned at least two commercial properties with 138,600 square feet and a city-determined market value of $20 million. (Market value is typically about 50% of actual value.) The portfolio has $48.8 million in debt, borrowed from JPMorgan Chase. Within the portfolio, all identified are industrial properties. They are all located in Bronx.

Surrounding

Within a 400-foot radius of 444 East 10th Street, Pincusco identified two commercial real estate items of interests occurred over the past 24 months.
Of those two items, two were loans above $5 million totaling $24.7 million. The most recent of the two was Neighborhood Restore HDFC which borrowed $18.7 million from Local Initiatives Support Corporation secured by the 14,653-square-foot, 24-unit co-op (C6) on 406 East 10th Street and two other properties on July 20, 2021.

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