Biggest outer-borough loans topped $1B in May

Big borrowers were flush ahead of interest rate hike

MaryAnne Gilmartin, 44-02 Vernon Boulevard, 98 De Kalb Avenue and Rockrose Development's Justin Elghanayan in Mott Haven (Google Maps, iStock, Getty, Rockrose)
MaryAnne Gilmartin, 44-02 Vernon Boulevard, 98 De Kalb Avenue and Rockrose Development's Justin Elghanayan in Mott Haven (Google Maps, iStock, Getty, Rockrose)

The 10 largest real estate loans recorded in New York City’s outer boroughs in May totaled $1.16 billion, much higher than April’s $675 million but well under the $1.6 billion from a year ago.

Six of the 10 loans were issued in Brooklyn, three in the Bronx and one in Queens. New construction loans proved popular amid rising costs of housing and energy, and came just ahead of the Federal Reserve hiking interest rates 75 basis points, the highest single increase since 1994.

Here are details of last month’s largest outer-borough loans.

1. Fortress Greene | $240 million

Henry and Justin Elghanayan’s Rockrose Development received $240 million from Wells Fargo to construct a 49-story residential building at 98 DeKalb Avenue in Fort Greene, Brooklyn. The 450,000-square-foot structure will have 569 apartments, according to plans approved by the Department of Buildings in May. Rockrose acquired the land and air rights for the project, also addressed as 180 Ashland Place, in 2020 for $81 million.

2 & 10. Chess moves | $125 million; $49 milion

Cheskel Schwimmer’s Chess Builders secured $125 million from Valley National Bank backed by the leasehold on the Arches, a new 400,000-square-foot residential development with 430 residential units at 198 East 135th Street in Mott Haven, the Bronx. The funds consolidated construction debt from S3 Capital Partners and other prior loans.

Chess Builders simultaneously sold the ground beneath the two-building development for $105 million to Haven Capital, which received $49 million from Goldman Sachs to make the purchase.

3. Power grab | $165 million

A group of investors led by Bruce Teitelbaum and MaryAnne Gilmartin received $165 million from Michael Dell’s MSD Capital to pick up 44-02 Vernon Boulevard, a waterfront site in Long Island City spanning more than 200,000 square feet, from the clutches of Robert Durst. The loan includes $119 million in new funds and follows a decade-long court battle ignited by Durst’s maneuver to foreclose on the site. Teitelbaum recently bought out Durst’s mortgage on the property for $97 million. The site allows for a 1.2 million-square-foot residential development as of right, although Teitelbaum has pitched rezoning the site for a larger project together with a renewable energy component.

4. Rental refi | $144 million

The Brodsky Organization refinanced construction debt at 662 Pacific Street in Prospect Heights, Brooklyn, with $144 million from Apollo Global Real Estate Management. The loan replaces debt originated by Bank of New York Mellon for the newly built, 28-story rental building with 312 units.

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5. Finish-line funds | $119 million

CIM Group received $119 million from JPMorgan Chase to complete its mammoth residential project at 85 Jay Street in Dumbo, Brooklyn, slated to have 730 condominium and apartment units, about 90,000 square feet of retail and approximately 700 parking spaces. The developer announced in 2018 that JPMorgan had agreed to lend it $600 million. Scott Rechler’s RXR agreed last year to buy part of the project that included 320 rental units for $220 million.

6. Marvel in Midwood | $92 million

A company controlled by Baruch Singer got $92 million from Parkview Financial, a real estate investment trust, to finish a 10-story office and retail building spanning 215,000 square feet at 1508 Coney Island Avenue in Midwood, Brooklyn. The building is 30 percent pre-leased, according to the lender. Singer, who has a checkered past as a residential landlord, bought the site back in 2006 for $27 million.

7. Gaga over Gowanus | $77 million

Simon Dushinsky and Isaac Rabinowitz’s Rabsky Group scored $77 million as part of $92 million in construction financing from G4 Capital for a 526,000-square-foot, mixed-use project at 313-315 Bond Street in Gowanus. The developers bought the property from Yoel Goldman’s company All Year Management in 2019 for $95 million. Developers flocked to the Brooklyn neighborhood after the city backed a rezoning plan to create affordable housing on the banks of the Gowanus canal.

8. Cash infusion | $77 million

Joseph Simone refinanced two office buildings spanning 560,000 square feet at 1250 Waters Place in the Bronx’s Pelham Bay with $77 million from insurer Ullico. The loan included $21 million in new funds and replaced Deutsche Bank as the senior lender. Simone Development Companies has its headquarters in one of the buildings, which are mostly leased by medical service providers.

9. Bankruptcy bonanza | $68 million

David Bistricer’s Clipper Equity received $67.5 million from Valley National Bank for its purchase of 2359 and 2360 Bedford Avenue in Flatbush, Brooklyn. The developer bought the parcels out of Sears’ bankruptcy proceedings for a combined $91 million. A landmarked department store belonging to the once-great retailer sits adjacent to sites, where Clipper plans to build two residential buildings totaling 456,000 square feet with 650 units.

Pat Ralph contributed reporting.