Zvieli avoids threatened foreclosure with $35M refi on former dorm in Flatbush

Yosef Sefi Zvieli’s company Zvieli through the entity New Brooklyn Development LLC as borrower signed a refi loan with the anonymous lender One Ken Funding LLC valued at $35 million for the former dorm building at 1 Kenilworth Place in Flatbush, Brooklyn.
The deal closed on March 18, 2022 and was recorded on April 4, 2022. The prior lender was Fannie Mae which held debt that had an original loan amount of $30.2 million.

The property has 58,027 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $603 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 Zvieli was Mark J. Nussbaum. The signatory for One Ken Funding LLC was Hillel Lazarus. Zvieli also known as Zvieli Group is controlled by Yosef Sefi Zvieli. Lender Fannie Mae filed in July 2021 to foreclose on the $30 million loan on the property, as PincusCo reported at the time.  One Kenilworth Place was a residence hall of Brooklyn College.  An interim forbearance and settlement agreement dated December 21, 2021, and filed in January 2022 in the foreclosure case required the property to remain a student dorm until the loan was paid off.

The property

The 1 Kenilworth Place parcel has frontage of 116 feet and is 133 feet deep with a total lot size of 10,165 square feet. The lot is irregular. The zoning is R5B which allows for up to 1.35 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $8.9 million.

Violations and lawsuits

The property was involved in one lawsuit and zero bankruptcies over the past two years. The suit was a $30.2 million commercial foreclosure concerning a loan filed on July 9, 2021, by Fannie Mae and Federal National Mortgage Association against Yosef Sefi Zvieli. In addition, according to city public data, the property has received nine DOB violations and $1,825 in OATH penalties in the last year.

Development

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 Flatbush, the bulk, or 47 percent of the 51.8 million square feet of commercial built space are residential elevator buildings, with 1-4 family buildings next occupying 17 percent of the space. In sales, Flatbush has had very little sales volume relative to other neighborhoods with $208.8 million in sales volume in the last two years. For development, Flatbush has near average amount of major developments among other neighborhoods and is the 20th highest in Brooklyn. It had 1 million square feet of commercial and multi-family construction under development in the last two years, which represents 2 percent of the neighborhood’s built space. There was one 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 three of the 28 commercial properties representing 25,300 square feet of the 179,131 square feet. The two identified owners are Eliahu Nahman and G-Way Management. There is one active new building construction project totaling 34,487 square feet. It is a 45-unit, 34,487-square-foot R-2 building developed by David Sinay with plans filed March 8, 2019 and permitted June 29, 2021.

The majority, or 41 percent of the 255,468 square feet of built space are mixed-use buildings, with 1-4 family buildings next occupying 25 percent of the space.

Surrounding

Within a 400-foot radius of 1 Kenilworth Place, PincusCo identified two commercial real estate items of interests occurred over the past 24 months.
Of those two items, one was in new building development. It was a new building permit issued on June 30, 2020 for a 20,372-square-foot R-2 building with 22 residential units at 1409 Flatbush Avenue.
One of those two items was a loan which Yeremiah Teitelbaum borrowed $5.5 million from Conventus secured by the 27,639-square-foot, 23-unit rental (D6) on 1407 Flatbush Avenue on October 22, 2021.

Direct link to Acris document. link