Blockshares.com

722 Myrtle Avenue

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DEAL SNAPSHOT

The developer has purchased and is repositioning this former meat warehouse facility to a mix of medical, residential, retail and warehouse space. Projected yield of over 21%.


$1,571,000

OFFERING SIZE

16.9%

PROJECT YIELD

$7,500

MINIMUM INVESTMENT

100% FUNDED

100% Funded

Investment Summary

The developer has secured a below market purchase price on the property.

Once existing tenants are vacated, the top 2 floors of this 50,000 foot former meat warehouse building will undergo a major renovation. In the place of the old freezers and meat lockers, Hannah Realty plans to develop a state-of-the-art alcoholic treatment facility to be operated by the City of New York's Kings County Health and Hospital Division. The ground floor of the property will be converted to a mix of retail and small warehousing tenants. There is a small residential component to the project of four 2 bedroom apartments.

In addition, the building has upside potential for income generation due to a favorable mix of ground floor warehouse tenants and below market rates in the residential units.

Another option, which will be explored over time, is the conversion of certain ground floor spaces from warehousing use to retail use, as the Bedford Stuyvesant area continues its' growth trajectory. The developer has plans to renovate and upgrade the residential units, projecting an increase of 45% in rental cash flow for the residential component of the property.


Financial Overview

$1,571,000

Offering Size

$7,500

Minimum Investment

5 Years 

Project Hold Period

16.9%

Project Annual Yield



Property Data

  • Multiple tenant property.
  • Largest tenant is a city goverment agency secured with long term lease.
  • Residential component high potential for rapid appreciation due to location.
  • Four ground floor warehouse tenants have retail conversion potential.
  • Three retail units are currently rented below market rates - large increases upon renewals.
RENNOVATED (EXTERIOR)
RENNOVATED (INTERIOR)


Area Analysis

  • Property is located in Brooklyn on the borders of Bed-Stuy, Willamsburg and Clinton Hill.
  • Brooklyn as a whole, and these areas specifically, have witnessed remarkable growth and rebirth over the past 5 years.
  • Location is under 2 miles from Manhattan, Barclays Center (Downtown Brooklyn).
  • Walking distance (7 blocks) from Pratt Institute of Technology.
  • Bus lines and subways lines within 3 blocks.
40.695087
-73.953794
The developer has secured a below market purchase price on the property. Once existing tenants are vacated, the top 2 floors of this 50,000 foot former meat warehouse building will undergo a major renovation. In the place of the old freezers and meat lockers, Hannah Realty plans to develop a state-of-the-art alcoholic treatment facility to be operated by the City of New York's Kings County Health and Hospital Division. The ground floor of the property will be converted to a mix of retail and small warehousing tenants. There is a small residential component to the project of four 2 bedroom apartments. In addition, the building has upside potential for income generation due to a favorable mix of ground floor warehouse tenants and below market rates in the residential units. Another option, which will be explored over time, is the conversion of certain ground floor spaces from warehousing use to retail use, as the Bedford Stuyvesant area continues its' growth trajectory. The developer has plans to renovate and upgrade the residential units, projecting an increase of 45% in rental cash flow for the residential component of the property.
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Developer

Hannah Realty Associates is real estate development and management company headquartered in Brooklyn, NY. The company invests in both cash-flowing and vacant commercial properties with potential for high return on property repositioning. The company is actively pursuing new acquisitions to increase the size of its real estate portfolio, which currently consists of properties in both New York and Texas.

Ownership Structure (Equity Breakdown)

Blockshares $1,571,000 20.01%
Developer Investment Equity $3,140,000 39.99%
Private Investor Equity $3,140,000 39.99%
Total Equity Stake $7,851,000 100%


Project Cost and Payout

Annual Return
$834,657
Net Income
÷
$4,949,124
Project Cost
=
16.9%
Annual Return


Project Costs

Budget
Real Estate Taxes 42.6% $51,213
Repairs and Maintenance 28.28% $34,005
Utilities 29.12% $35,010
Total 100% $120,228


Project Income and Expense

Hard Costs
Acquisition Costs 79.91% $3,755,000
Construction Costs 20.09% $944,124
Total 100% $4,699,124
Soft Costs
Miscellaneous Soft Costs 100% $250,000
Total 100% $250,000
Total Hard Costs $4,699,124 95%
Total Soft Costs $250,000 5%
Total Development Costs $4,949,124 100%
Annual Return
Apartment Rentals (4 x 1 Bedroom Units) 6.3% $60,141
Commercial Rentals (6 Units) 42.18% $402,744
Medical Offices, 25,000 square feet 51.52% $492,000
Total 100% $954,885
Expenses
Real Estate Taxes 42.6% $51,213
Repairs and Maintenance 28.28% $34,005
Utilities 29.12% $35,010
Total 100% $120,228
Annual Net Income
Gross Income $954,885
Total Expenses $120,228
Annual Income $834,657


Development Plans

722 Myrtle Avenue has upside potential for income generation due to its' mix of ground floor warehouse tenants and below market rates of the residential unit rentals. The ground floor space will be converted from warehousing use to retail as the leases terminate, and the Bedford Stuyvesant area continues its' growth trajectory. The developer has plans to renovate and upgrade the residential units in fiscal 2017, projecting an increase of 45% in rental cash flow for the residential component of the property.


Property Highlights

  • Second and third floors have been repositioned from meat warehousing freezers to approximately 20,000ft of medical facility space.
  • Ground floor has a mix of retail and warehouse tenants with short term leases, which provide large upside for retail conversion.
  • Four residential units are month to month leases, which provide high upside potential in this rapidly growing area.
  • 12,000 square foot basement has 14 ft ceilings - currently being marketed for gym use, which would add approximately $100,000 annual net income to current property cash flow.


Milestones Date
Upstairs converted from warehousing use to medical space. 2006
Property 100% leased. 2007
Warehouse to retail conversion planned. 2017
Residential units upgrade planned. 2018

Area Overview

40.69446
-73.9555488
700 Myrtle Avenue, Brooklyn, NY 11205, USA
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40.6914315
-73.959848
262 Taaffe Place, Brooklyn, NY 11205, USA
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40.695087
-73.953794
722 Myrtle Ave, Brooklyn, NY 11205, USA
/img/block_icon.png
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Bedford-Stuyvesant, , NY

Area Analysis

  • Property is located in Brooklyn on the borders of Bed-Stuy, Willamsburg and Clinton Hill.
  • Brooklyn as a whole, and these areas specifically, have witnessed remarkable growth and rebirth over the past 5 years.
  • Location is under 2 miles from Manhattan, Barclays Center (Downtown Brooklyn).
  • Walking distance (7 blocks) from Pratt Institute of Technology.
  • Bus lines and subways lines within 3 blocks.
Located in the center of Brooklyn, Bedford-Stuyvesant has emerged as a hotspot for arts and culture in Brooklyn and is one of the most dynamic and fastest growing neighborhoods in the Borough. The area has seen an influx of restaurants, bars and is being improved and renovated with strong support of the local community. Good transportation and proximity to Manhattan, Downtown Brooklyn, Bushwick, and Williamsburg make Bed-Stuy an area with strong potential for rapid future growth

Comparable Area Properties

700 Myrtle Avenue

700 Myrtle Avenue, Brooklyn, NY 11205

Property Type : Mixed Use
Number of Units : 92
Status : Existing
Year Built : 1937
Stories : 6
Building Size : 147209
232-262 Taaffe Place

232-262 Taaffe Place, Brooklyn, NY 11205

Property Type : Mixed Use
Number of Units : 109
Status : Existing
Year Built : 1935
Stories : 5
Building Size : 130000

Developer Information

Hannah Realty Associates is real estate development and management company headquartered in Brooklyn, NY. The company invests in both cash-flowing and vacant commercial properties with potential for high return on property repositioning. The company is actively pursuing new acquisitions to increase the size of its real estate portfolio, which currently consists of properties in both New York and Texas.


Managing Members

Marc Fishman
Marc Fishman

Marc is a co-founder and Managing Principal for Hannah Realty Associates. Prior to forming Hannah Realty, Marc worked at Deutsche Bank where he played a key role in the securitization of over $100,000,000 in real estate assets for the bank. At Hannah Realty, Marc is responsible for the day to day operations of the real estate assets and their affiliated single-purpose entities, corporate and asset management practices, financial reporting, planning and capital structure.



Scot Fishman
Scot Fishman

Scot is a Managing Principal and co-founder of Hannah Realty Associates. Prior to forming Hannah Realty, Scot had experience as an investment grade bond trader and as the co-founder of an internet company. In his current role for Hannah Realty, he identifies, analyzes and negotiates acquisitions, and leases for the company. Additionally, he assists in asset management of the existing portfolio, including, marketing, and technology platforms.





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