Taconic, Nuveen sign $78.8M initial loan with Ares Commercial for two properties in Yorkville

Taconic Partners and Nuveen through the entity 309 East 94th Street Property Owner LLC as borrower signed a initial loan with lender Ares Commercial Real Estate through the entity Dreg Cared Lender LLC valued at $78.8 million for two properties including the midblock office building at 309 East 94th Street in Yorkville, Manhattan and midblock industrial building at 324 East 95th Street in Yorkville, Manhattan.
The deal closed on April 12, 2022 and was recorded on May 2, 2022. The two properties have 87,722 square feet of built space and 50,655 square feet of additional air rights for a total buildable of 138,475 square feet according to PincusCo analysis of city data. The loan price per built square foot is $897 and the price per buildable square foot is $568 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 Taconic Partners and Nuveen was Andrew Zlotnick. Commercial Observer first reported that Taconic and Nuveen signed the refi loan for the Upper East Side project. JLL Capital Markets’ Evan Pariser, Aaron Niedermayer and Geoff Goldstein were brokers on the financing, according to the report. The loan includes $24,652,550 in construction funding.

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 309 East 94th Street.

Prior sales and revenue

The two properties with a total of 87,722 square feet of built space generated revenue of $4.4 million per year or $50 per square foot.

The property

The 309 East 94th Street parcel has frontage of 225 feet and is 100 feet deep with a total lot size of 22,660 square feet. The zoning is C8-4 which allows for up to 5 times floor area ratio (FAR) for commercial The city-designated market value for the property in 2022 is $12.9 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have received $350 in OATH penalties in the last year.

Development

For the tax lot buildings, one out of the two buildings received a initial certificate of occupancy in the last ten years. 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 Yorkville, the majority, or 71 percent of the 43.2 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 17 percent of the space. In sales, Yorkville has 1.4 times the average sales volume among other neighborhoods with $398.1 million in sales volume in the last two years and is the 23rd highest in Manhattan. For development, Yorkville has 1.7 times the average amount of major developments relative to other neighborhoods and is the 13th highest in Manhattan. It had 1.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 4 percent of the neighborhood’s built space.

The block

On the tax block of 309 East 94th Street, PincusCo has identified the owners of 116 of the 132 commercial properties representing 533,191 square feet of the 718,143 square feet. The largest owner is Empire State Realty Trust, followed by Trevor Day School and then Kiska Developers. There are no active new building construction projects on this tax block.

The majority, or 35 percent of the 634,145 square feet of built space are residential elevator buildings, with residential walkup buildings next occupying 25 percent of the space.

The borrower

The PincusCo database, which is incomplete, currently indicates that Taconic Partners owned at least 12 commercial properties with 1,222,097 square feet and a city-determined market value of $143.8 million. (Market value is typically about 50% of actual value.) The portfolio has $1.2 billion in debt, with top three lenders as Upper Manhattan Empowerment, JPMorgan Chase, and Union Labor Life Insurance Company respectively. Within the portfolio, the bulk, or 69 percent of the 1,222,097 square feet of built space are residential walkup properties, with residential elevator properties next occupying 21 percent of the space. The bulk, or 89 percent of the built space, is in Bronx, with Manhattan next at 11 percent of the space.

Surrounding

Within a 400-foot radius of 309 East 94th Street, PincusCo identified seven commercial real estate items of interests occurred over the past 24 months.
Of those seven items, two were sales above $5 million totaling $118.8 million. The most recent of the two was Empire State Realty Trust which bought the 207,037-square-foot, 211-unit rental (D7) on 345 East 94th Street and one other property for $88.4 million from Fetner Properties on February 7, 2022.
Of those seven items, five were loans above $5 million totaling $153.7 million. The most recent of the five was Kiska Developers which borrowed $45.5 million from BankUnited secured by 110 condo units in the 1,771-square-foot, 110-unit mixed-use building (RC) on 301 East 94th Street on March 7, 2022.

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