EJS Group, Hope Street pay $33.6M to Time Square, The Collective for dev site in Bed Stuy

EJS Group and Hope Street Capital through the entity Fulton Property Owner LLC paid $33.6 million to Tower Holdings Group, Time Square Development, and The Collective through the entity 1215 Fulton Street LLC for the development site at 1215 Fulton Street in Bed Stuy, Brooklyn.
The deal closed on March 2, 2022 and was recorded on March 16, 2022. The property has zero square feet of built space and 179,340 square feet of additional air rights for a total buildable of 179,340 square feet according to PincusCo analysis of city data. The sale price per buildable square foot is $187 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 seller bought the property and a smaller adjacent parcel on February 28, 2019, for $32.5 million. The city’s Department of Buildings says the two lots, 15 and 16, were merged, but Acris records do not reflect that.

The signatory for Tower Holdings Group, Time Square Development, and The Collective was Geoffrey Raicht. The signatory for EJS Group and Hope Street Capital was Adam Koplewicz. Time Square is a division of Tower Holdings Group. Time Square partnered with the Collective to buy the site. The loan guarantors for the sellers, prior to the sale, were Mohammed Reza Aslam Merchant of The Collective and Kevin O’Sullivan, president of Tower Holdings. EJS Group’s Theodore “Ted” Segal was the signatory for the $20 million acquisition loan, while EJS’s Adam Koplewicz was signatory for the purchase.  The owner entity is at the address of Hope Street Capital.

Prior sales and revenue

Prior to this transaction, Pincusco has records that the buyer EJS Group purchased three properties in three transactions for a total of $32.4 million and has no record it sold any properties over the past 24 months.

The property

The 1215 Fulton Street parcel has frontage of 60 feet and is 237 feet deep with a total lot size of 42,700 square feet. The lot is irregular. The zoning is C4-5D which allows for up to 4.2 times floor area ratio (FAR) for commercial and up to 4.2 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $5.6 million.

Violations and lawsuits

The property was not involved in any lawsuits or bankruptcies in the past years. In addition, according to city public data, the property has received $10,000 in ECB penalties and $14,500 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 336-unit, 163,708-square-foot hotel (R-1) building. The project was developed by Robert Pinkas with plans filed September 16, 2019 and it has not been permitted yet. Yimby reported on renderings for the site in 2019.

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 development buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of eight of the 28 commercial properties representing 41,101 square feet of the 120,526 square feet. The largest owner is Bawabeh Brothers, followed by Infinity Real Estate and then CB-Emmanuel Realty. There are three active new building construction projects totaling 214,531 square feet. The largest is a 336-unit, 163,708-square-foot R-1 building developed by Robert Pinkas with plans filed September 16, 2019 and it has not been permitted yet.The second largest is a 31-unit, 23,081-square-foot R-2 building developed by Baruch Guttman with plans filed January 10, 2020 and it has not been permitted yet.

The majority, or 41 percent of the 200,176 square feet of built space are mixed-use buildings, with 1-4 family buildings next occupying 37 percent of the space.

Surrounding

Within a 400-foot radius of 1215 Fulton Street, PincusCo identified nine commercial real estate items of interests occurred over the past 24 months.
Of those nine items, one was in new building development. It was a new building permit application filed on August 18, 2021 for a 19,226-square-foot R-2 building with 23 residential units at 1241 Bedford Avenue.
Of those nine items, one was for major renovation including a certificate of occupancy change. It was an initial temporary certificate of occupancy issued on December 17, 2020 for the $880,231 renovation of 8,212-square-foot R-2 building with 12 residential units at 1255 Bedford Avenue.
One of those nine items was a sale which Frontgage Management bought the 14,760-square-foot, one-unit industrial (I5) on 1217 Bedford Avenue for $6.2 million from Tobias Strulovitch on November 12, 2019.
Of those nine items, six were loans above $5 million totaling $147.5 million. The most recent of the six was Infinity Real Estate which borrowed $6.6 million from Sterling National Bank secured by the 7,836-square-foot, one-unit retail building (K1) on 1245 Fulton Street on December 13, 2021.

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