Yitzchok Katz pays $42.5M for 134-unit W’burg dev site with $35M Scale loan

575 Grand Street (Credit: Google)

Yitzchok Katz through the entity Lorimer St Holdings LLC paid $42.5 million to the Conte family’s Tapps Supermarkets for the retail grocery store building at 575 Grand Street in Williamsburg, Brooklyn. The site has long been a Key Foods location. In February, Jacob Katz filed a plan with the city’s Department of Buildings for a 134-unit residential building at the site.

Katz as borrower signed an acquisition loan with lender Slate Property Group’s Scale Lending through the entity Scale Grand Lender LLC valued at $35 million.

The deal closed on March 22, 2022 and was recorded on April 1, 2022.

City data says the property has 8,500 square feet of built space and 101,475 square feet of additional air rights for a total buildable of 110,000 square feet according to PincusCo analysis of city data. However the one-story building appears to be closer to 14,000 square feet. The sale price per buildable square foot is $386 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 Tapps Supermarkets was Paul S. Conte. The signatory for Yitzchok Katz was Yitzchok Katz.

Prior sales and revenue

Prior to this transaction, Pincusco has records that the buyer Yitzchok Katz purchased nine properties in four transactions for a total of $12.8 million and has no record it sold any properties over the past 24 months.
The seller Tapps Supermarkets had not purchased any other properties and had not sold any properties over the same time period. The 8,500-square-foot property generated revenue of $307,497 or $36 per square foot, according to the most recent income and expense figures.

The property

The 575 Grand Street parcel has frontage of 100 feet and is 275 feet deep with a total lot size of 27,500 square feet. The lot is irregular. The zoning is C4-4A which allows for up to 4 times floor area ratio (FAR) for commercial and up to 4 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $2.2 million.

Violations and lawsuits

The property was not involved in any lawsuits or bankruptcies in the past years. In addition, according to city public data, the property has received $2,200 in OATH penalties in the last year.


On these lots, there is a new building project for a 134-unit, 158,072-square-foot R-2 building developed by Yitzchok Katz with plans filed February 3, 2022 and it has not been permitted yet.

The neighborhood

In Williamsburg, the bulk, or 35 percent of the 65.1 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 19 percent of the space. In sales, Williamsburg has the 9th highest sale turnover among other neighborhoods in the city with $1.4 billion in sales volume in the last two years. For development, Williamsburg is the 6th most active neighborhood among other neighborhoods. It had 5.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 8 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of three of the 15 commercial properties representing 14,905 square feet of the 75,813 square feet. The largest owner is Manjula Mukahopadhyay, followed by Paul Pollak and then Diana Sutowski. There are two active new building construction projects. The largest is Katz’s project. the second largest is a nine-unit, 7,884-square-foot R-2 building developed by Han Soon Yom with plans filed December 18, 2015 and it has not been permitted yet.

The majority, or 32 percent of the 102,018 square feet of built space are residential walkup buildings, with 1-4 family buildings next occupying 26 percent of the space.

The buyer

The PincusCo database currently indicates that Yitzchok Katz owned at least 13 commercial properties with 101,462 square feet and a city-determined market value of $16.5 million. (Market value is typically about 50% of actual value.) The portfolio has $64.5 million in debt, with top three lenders as Berkadia Commercial Mortgage, Investors Bank, and Sterling National Bank respectively. Within the portfolio, the bulk, or 78 percent of the 101,462 square feet of built space are residential elevator properties, with retail properties next occupying 12 percent of the space. The bulk, or 90 percent of the built space, is in Brooklyn, with Queens next at 10 percent of the space.


Within a 400-foot radius of 575 Grand Street, Pincusco identified four commercial real estate items of interests occurred over the past 24 months.
Of those four items, one was in new building development. It was a new building permit application filed on November 3, 2021 for a 17,283-square-foot R-2 building with 22 residential units at 566 Grand Street.
Of those four items, two were for major renovation including a certificate of occupancy change. They were one permit with a total initial cost of $495,762 and one initial temporary certificate of occupancy issuance for a project that initially costed $793,250. The most recent of these two items was the permit on June 21, 2021 for a 3,385-square-foot R-3 building with one residential units at 227 Leonard Street.
One of those four items was a loan which Abraham Grunhut borrowed $5.3 million from Signature Bank secured by the 7,184-square-foot, eight-unit rental (C7) on 576 Grand Street on August 3, 2021.

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