Yellowstone buys $110M note secured by New York Hotel in Garment District

Yellowstone Real Estate Investments through the entity YS 481 Eighth Holdings LLC bought a note with an original principal of $110 million from M&T Bank secured by the Unification Church’s hotel building (H2) at 481 8th Avenue in Garment District, Manhattan.
The deal closed on September 1, 2023 and was recorded on September 7, 2023. The prior lender was M&T Bank which held debt that had an original loan amount of $110 million.

The Commercial Observer reported earlier this week that the note was $106 million.

The property has 1,300,727 square feet of built space according to a PincusCo analysis of city data.
The signatory for the Unification Church was Michael Balcomb. The property is formally owned by The Holy Spirit Association for the Unification of World Christianity, which is an early name for the Unification Church, also known as Family Federation for World Peace and Unification (FFWPU).

Yellowstone acquired EPIC’s Time Square office building and bought the debt on Capstone Equities’ Maxwell Hotel.

Prior sales and revenue

The owners according to the Department of Housing Preservation and Development includes Ciriel Monsels, head officer and Tal Zorer, officer. The business entity is Holy Spirit Assoc For The Unification.

The property

The hotel building in Garment District has 1,300,727 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 197 feet and is 175 feet deep with a total lot size of 34,561 square feet. 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 $148.9 million.

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 one DOB violation, $3,125 in ECB penalties, three housing violations, $16,900 in OATH penalties, and one housing litigation in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Garment District, The majority, or 69 percent of the 51.8 million square feet of commercial built space are office buildings, with hotel buildings next occupying 12 percent of the space. In sales, Garment District has 2.1 times the average sales volume among other neighborhoods with $746.5 million in sales volume in the last two years and is the 19th highest in Manhattan. For development, Garment District has 3.7 times the average amount of major developments relative to other neighborhoods and is the 6th highest in Manhattan. It had 3.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 7 percent of the neighborhood’s built space. There were two pre-foreclosure suit filed among other hotel buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of two of the six commercial properties representing 1,643,323 square feet of the 1,756,923 square feet. The two identified owners are Taconic Partners and Holy Spirit Association For The Unification Of World Christianity.
There are no active new building construction projects on this tax block.

The majority, or 74 percent of the 1.8 million square feet of built space are hotel buildings, with office buildings next occupying 19 percent of the space.

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