All Year and David Werner renegotiate deal for $300M Brooklyn portfolio sale

National /
Jul.July 01, 2020 02:00 PM
Clockwise from top left: 871 Grand Street, 392 St. Marks Avenue, 607 Franklin Avenue and 600 Park Place in Brooklyn (Credit: Google Maps; iStock)

Clockwise from top left: 871 Grand Street, 392 St. Marks Avenue, 607 Franklin Avenue and 600 Park Place in Brooklyn (Credit: Google Maps; iStock)

Not all coronavirus-impacted real estate deals need to go to court, after all.

After the pandemic slammed the brakes on All Year Management’s sale of a 74-building, $346 million multifamily portfolio to investor David Werner in May, the parties negotiated for nearly two months in efforts to salvage the deal. The new transaction is slightly smaller than before, and significantly more complex.

Under the new agreement, Werner has agreed to acquire 68 buildings for about $302 million, according to a disclosure Yoel Goldman’s All Year filed Wednesday with the Tel Aviv Stock Exchange. The deal would be executed in two stages: 45 properties will be sold for $176.6 million in late July, and the remaining 23 will be sold for $125.8 million in November.

The $15 million deposit Werner had paid for the original deal will go towards a $21.5 million deposit on stage one of the deal, and the buyer will put up another $1 million deposit for the second stage of the transaction.

The new deal also gives Werner, a prolific syndicator within the Borough Park Orthodox community, the option to pay for a portion of the transaction with a preferred equity stake, with a maximum value of $17.3 million for stage one and $12.3 million for stage two. The preferred equity will mature in June 2021 — with two 12-month extension options — and carry an initial interest rate of 6 percent.

The parties also agreed to split tax payments on the transaction 50-50, according to the disclosure.

All Year expects positive cash flow from the deal, after debt payments and transaction costs, to total about $53 million — $28 million in stage one and $25 million in stage two. If Werner opts for the maximum amount of preferred equity, without exercising extension options, Goldman’s firm expects to see $35 million in positive cash flow from the deal this year and another $19 million next June.

All Year declined to comment.

Contact Kevin Sun at [email protected].


Related Articles

arrow_forward_ios
Mack Real Estate Group's Richard Mack and JPMorgan's Jamie Dimon with a rendering of 123 Melrose Street (Credit: Getty Images and ODA Architecture)
Yoel Goldman sews up long-term funds for Rheingold Brewery Project
Yoel Goldman sews up long-term funds for Rheingold Brewery Project
Rabsky Group buying Gowanus parcel from Yoel Goldman for $95M: sources
Rabsky Group buying Gowanus parcel from Yoel Goldman for $95M: sources
Rabsky Group buying Gowanus parcel from Yoel Goldman for $95M: sources
A selection of the properties, from left: 1020 Pacific Street, 818 Bergen Street, 483 St. Marks Avenue and 634 Classon Avenue (Google Maps, Kings County Supreme Court/Illustration by Alexis Manrodt for The Real Deal)
All Year settles with partner in Prospect Heights deed dispute
All Year settles with partner in Prospect Heights deed dispute
William Vale Hotel at 11 North 12th Street in Williamsburg (Photo via William Vale/Illustration by Kevin Rebong for The Real Deal)
William Vale hotel in new dispute with Zelig Weiss, Yoel Goldman
William Vale hotel in new dispute with Zelig Weiss, Yoel Goldman
An aerial view of 134 Vanderbilt Avenue and renderings of the project (Google Maps, Tankhouse)
Tankhouse plans mixed-use project at Clinton Hill gas station site
Tankhouse plans mixed-use project at Clinton Hill gas station site
US developers face Israeli bond market reckoning
From slam dunk to junk: US developers face Israeli bond market reckoning
From slam dunk to junk: US developers face Israeli bond market reckoning
A selection of the properties, from left: 1020 Pacific Street, 818 Bergen Street, 483 St. Marks Avenue and 634 Classon Avenue (Google Maps, Kings County Supreme Court/Illustration by Alexis Manrodt for The Real Deal)
All Year sues partner over “illegitimate” deed transfers
All Year sues partner over “illegitimate” deed transfers
(The Denizen, Facebook via Jonathan Braun)
All Year recants allegation against Trump-pardoned drug smuggler
All Year recants allegation against Trump-pardoned drug smuggler
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...