Suspended Astoria rentals get going with cash infusion

Josh Zegen of Madison Realty Capital and the unfinished Queens rental
Josh Zegen of Madison Realty Capital and the unfinished Queens rental

A 28-unit unit rental building in Astoria delayed by a neighborhood rezoning will finally be completed, now that the developer has received a construction loan from Madison Realty Capital, principals of the commercial real estate investment firm told The Real Deal.

The seven-story, 25,000-square-foot building at 28-18 Astoria Boulevard will be comprised of only one-bedroom units and will have 2,289 square feet of retail space and a 1,189-square-foot community facility. It is being developed by local Queens developer Charalabos Bakalis.

Industry pros said there has been a major uptick in interest in Queens rentals in recent months as spiking Brooklyn and Manhattan rents have forced out tenants.

Balakis purchased the site for $2.86 million in 2007, public records show, and filed plans for the new building shortly after. He started the project in 2008 but construction stalled when a 2010 rezoning of 238 blocks in Astoria rendered the project unlawful.

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The developer needed approvals from the Board of Standards & Appeals to continue with the project as it was originally conceived. The BSA only recently signed off on the approvals, according to Bryan Rubin, a vice president at Madison.

The new building already has a foundation and a steel frame in place. Completion of the project is expected within the next 12 to 18 months, Rubin said.

Madison provided a $7.5 million construction loan, which will be used to retire some outstanding debt on the property as well as fund the remaining construction. Bakalis could not immediately be reached for comment.