Zelig Weiss signs $105M refi with Starwood Mortgage Capital for Bed Stuy properties

378 Flushing Avenue (Credit: Google)
Zelig Weiss, through the entity Flushing & Little Nassau LLC, signed a $105 million refi with Starwood Mortgage Capital for two properties in Bedford-Stuyvesant, Brooklyn.
The refinancing covers the 60-unit residential elevator building at 378 Flushing Avenue and the neighboring midblock 15-unit property at 376 Flushing Avenue in Bed Stuy, Brooklyn.
The new loan replaces a previous $115 million loan from MF1 Capital. David Haley was the signatory for MF1 through the entity MFI 2021-FL6 LTD on the loan transfer.
Leslie Fairbanks was the signatory for Starwood Mortgage Capital.
The deal closed on March 4, 2022 and was recorded on March 18, 2022.
The two properties have 111,166 square feet of built space and 43,901 square feet of additional air rights for a total buildable of 153,620 square feet according to PincusCo analysis of city data. The loan price per built square foot is $944 and the price per buildable square foot is $683 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.)
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 378 Flushing Avenue.
Prior sales and revenue
The two properties with a total of 111,166 square feet of built space generated revenue of $4.7 million per year or $43 per square foot.
The property
The 378 Flushing Avenue parcel has frontage of 268 feet and is 102 feet deep with a total lot size of 25,061 square feet. The lot is irregular. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $4.7 million.The most recent loan totaled $48 million and was provided by MF1 Capital on June 4, 2021.
The 376 Flushing Avenue parcel has frontage of 75 feet and is 178 feet deep with a total lot size of 13,344 square feet. The lot is irregular. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $1.9 million.The most recent loan totaled $48 million and was provided by MF1 Capital on June 4, 2021.
Violations and lawsuits
The properties were not involved in any lawsuits or bankruptcies in the past years. In addition, according to city public data, the properties have received one DOB violation, $43,750 in ECB penalties, and $55,210 in OATH penalties in the last year.
The neighborhood
In Bed Stuy, the bulk, or 38 percent of the 92.5 million square feet of built space are 1-4 family buildings, with residential elevator buildings next occupying 20 percent of the space. In sales, Bed Stuy has 1.5 times the average sales volume among other neighborhoods with $417.3 million in sales volume in the last two years and is the 6th highest in Brooklyn. For development, Bed Stuy is the 8th most active neighborhood among other neighborhoods. It had 4.3 million square feet of commercial and multi-family construction under development in the last two years, which represents 5 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other residential elevator buildings in the past 12 months.
The block
On the tax block of 378 Flushing Avenue, PincusCo has identified the owners of two of the 15 commercial properties representing 128,920 square feet of the 396,372 square feet. The two identified owners are AZW Realty and Aaron Green. There are two active new building construction projects totaling 288,034 square feet. The largest is a 86-unit, 176,868-square-foot R-2 building developed by Zelig Weiss with plans filed August 6, 2018 and permitted October 30, 2020.
The majority, or 49 percent of the 405,846 square feet of built space are industrial buildings, with residential elevator buildings next occupying 25 percent of the space.
Surrounding
Within a 400-foot radius of 378 Flushing Avenue, Pincusco identified three commercial real estate items of interests occurred over the past 24 months.
Of those three items, two were in new building development. There were one new building permit application and one new building permit. The most recent of these two items was a filing on March 15, 2022 for a 115,580-square-foot R-2 building with 40 residential units at 51 Franklin Avenue.
One of those three items was a loan which Aaron Green borrowed $5.5 million from TD Bank secured by the 27,228-square-foot, 42-unit office building (O5) on 34 Franklin Avenue on July 26, 2021.
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