ZD Jasper Realty signs $103M construction loan in Hudson Yards

ZD Jasper Realty through the entity ZDJ Hudson Yards LLC as borrower signed a new construction loan with lender Preferred Bank valued at $103 million for a development site (V1) at 501 9th Avenue in Hudson Yards, Manhattan, development building (V1) at 485-487 9th Avenue in Hudson Yards, Manhattan, and development building (V1) at 489-491 9th Avenue in Hudson Yards, Manhattan.

On these lots, there are two active new building construction projects. The largest is a new building project for a 59-unit building (M00771039) submitted by Tom Wu with plans filed September 21, 2022 and it has not been permitted yet. The second largest is a new building project for a 63-unit building (M00771041 ) submitted by Tom Wu with plans filed September 20, 2022 and it has not been permitted yet.

The deal closed on September 1, 2023 and was recorded on September 8, 2023. The prior lender was First Commercial Bank which held debt that had an original loan amount of $24 million.
The four tax lots have zero square feet of built space and the two projects total just over 158,000 square feet according to a PincusCo analysis of city data. The loan price per development square foot is $562 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 ZD Jasper Realty was Zhidong Wu. The signatory for Preferred Bank was Sylvia Tseng.

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 501 9th Avenue.

The property

The parcel has frontage of 49 feet and is 197 feet deep with a total lot size of 11,289 square feet. The lot is irregular. The zoning is C1-7A which allows for up to 2 times floor area ratio (FAR) for commercial and up to 6.02 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $5.8 million. The most recent loan totaled $24 million and was provided by First Commercial Bank on May 10, 2022.

Violations and lawsuits

The properties were involved in three lawsuits and zero bankruptcies over the past two years. The highest value suit was a $5 million money judgment concerning a partnership filed on July 29, 2022, by Erik Eckstein and Eckstein Development Group against Joel Wiener and Pinnacle Group. In addition, according to city public data, the properties have received $4,080 in OATH penalties in the last year.

Development

On these lots, there are two active new building construction projects and major alteration projects with initial costs more than $5 million, totaling zero square feet. The largest is a new building project for a 59-unit building submitted by Tom Wu with plans filed September 21, 2022 and it has not been permitted yet. The second largest is a new building project for a 63-unit building submitted by Tom Wu with plans filed September 20, 2022 and it has not been permitted yet.

The neighborhood

In Hudson Yards, The majority, or 59 percent of the 16.8 million square feet of commercial built space are office buildings, with elevator buildings next occupying 22 percent of the space. In sales, Hudson Yards has 1.3 times the average sales volume among other neighborhoods with $478 million in sales volume in the last two years and is the 26th highest in Manhattan. For development, Hudson Yards has 2.2 times the average amount of major developments relative to other neighborhoods and is the 14th highest in Manhattan. It had 2.2 million square feet of commercial and multi-family construction under development in the last two years, which represents 13 percent of the neighborhood’s built space.

The block

On the tax block of 501 9th Avenue, PincusCo has identified the owners of nine of the 18 commercial properties representing 489,104 square feet of the 622,035 square feet. The largest owner is ZD Jasper Realty, followed by TF Cornerstone and then Pinnacle Group.
On the tax block, there were three new building construction projects totaling 15,155 square feet. The largest is a nine-unit, 15,155 square-foot residential (R-2) building submitted by Levi Balkany with plans filed August 17, 2016 and permitted April 11, 2019. The second largest is a 59-unit building submitted by Tom Wu with plans filed September 21, 2022 and it has not been permitted yet.

The majority, or 90 percent of the 622,035 square feet of built space are elevator buildings, with walkup buildings next occupying 7 percent of the space.

The borrower

The PincusCo database currently indicates that ZD Jasper Realty owned at least 14 commercial properties with 120 residential units in New York City with 113,234 square feet and a city-determined market value of $28.7 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 44 percent of the 113,234 square feet of built space are elevator properties, with industrial properties next occupying 38 percent of the space. The bulk, or 62 percent of the built space, is in Queens, with Manhattan next at 38 percent of the space.

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