4 Commercial Buildings
Auction Postponed

Details:

• Indirect Interest in 701-703 Fulton Street, 173 Lexington Avenue & 451 Classon Avenue, Brooklyn, NY
• The collateral comprises three walk-ups totaling nine residential units and 4,400 rentable square feet of retail space, including (i) Fulton, a six-unit walk-up residential building with 3,200 rentable square feet of ground floor retail space, (ii) Classon, a three-unit walk-up residential building with 1,200 rentable square feet of ground floor retail space, and (iii) Lexington, a 3,750 gross square foot two-story building consisting of a commercial unit situated above a storage garage. The residential units are all free market, benefit from either Class 1 or Class 2A tax classifications and offer a mix of one and two-bedroom layouts proximate to public transportation in the desirable neighborhoods of Fort Greene and Clinton Hill. The retail in Fulton and Classon offer walkable hard corner spaces along prominent intersections in Brooklyn. Lastly, Lexington offers flexibility as either a renovation of the existing structure or as a tear-down with an estimated 5,000 buildable square feet available to the site that carries an R6B zoning designation for low density residential.
• 701-703 Fulton Street is comprised of two adjacent 1930 built 3-story walk-up buildings located at 701-703 Fulton Street in the Fort Greene neighborhood of Brooklyn. 701 Fulton Street contains 5,806 gross square feet and four residential units accessible through an entrance on Saint Felix Street (aka 67 Saint Felix). 703 Fulton Street contains 2,970 gross square feet and two residential units accessible through an entrance on Fulton Street. Fulton benefits from favorable tax protected designations with 703 Fulton listed as Class 1 and 701 Fulton as Class 2A. State law limits how much the assessed value of Class 1 and Class 2A buildings in New York City can rise each year. Under the assessment cap, the assessed value of a Class 1 property can increase by a maximum of 6% per year, or 20% over five years, whichever is less. For Class 2A properties, the assessed value can increase by a maximum of 8% per year, or 30% over five years, whichever is less. The assessment cap system helps provide some stability and predictability in property taxes for Class 1 and Class 2A property owners in New York City and can create an arbitrage between what the market value of the property is and what the taxes are.
• 173 Lexington Avenue is a 1930 built 3,750 gross square foot 2-story building consisting of a commercial unit situated above a storage garage in the Bedford-Stuyvesant neighborhood of Brooklyn. 173 Lexington Avenue consists of 3,750 gross square feet designated as a factory and industrial building by New York City Zoning & Land Use. The 2,500 square foot site is zoned R6B, General Residence District, which allows for the development of a multifamily property on the site. Lexington was marketed for sale in 2022 via Compass for $2.9 million and the renderings called for a 4-story residential development, but nothing was filed with the Department of Buildings.  Lexington is zoned R6B, General Residence District, which was confirmed by a zoning verification letter issued by the Department of City Planning dated March 2023. The building’s 1937 classification as a factory building is considered Legally-Non-Conforming since it predates the current zoning ordinance. There is no Certificate of Occupancy on file for the property.
• 451 Classon Avenue is comprised of a 1930 built 4-story walk-up building located at 451 Classon Street in the Clinton Hill neighborhood of Brooklyn. 451 Classon Avenue contains 2,946 gross square feet comprised of three residential units situated above 1,200 rentable square feet of hard corner retail. Like 701 Fulton, Classon benefits from a Class 2A tax designation, which stipulates the assessed value can increase by a maximum of 8% per year, or 30% over five years, whichever is less. Classon is zoned R6B, General Residence District, which was confirmed by a zoning verification letter issued by the Department of City Planning dated March 2023. As part of the R6B zoning, use group 6A, which includes retail establishments, is not permitted as-of-right, thus the previous retail tenant at Classon was non-conforming. The most recent Certificate of Occupancy was issued in 1988 for Classon.
• Diligence materials are available upon request and execution of standard confidentiality and non-disclosure agreement.
• PLEASE TAKE NOTICE, that in accordance with applicable provisions of the Uniform Commercial Code as enacted in New York, by virtue of certain Event(s) of Default under those certain Pledge of Shares dated as of March 30, 2020 (the “Pledge Agreement”), executed and delivered by Juan Lopez a/k/a Juan P. Lopez a/k/a Juan Pablo Lopez (the “Pledgor”), and in accordance with it rights as holder of the security, Fulton Lex Classon, LLC (the “Secured Party”), by virtue of those certain UCC-1 Filing Statements made in favor of Secured Party, in accordance with Article 9 of the Uniform Commercial Code of the State of New York (the “Code”), Secured Party will offer for sale, at public auction, (i) Pledgor’s 100% issued and outstanding stock of J.J. Fulton Realty Corp. and Pledgor’s 100% issued and outstanding stock of 451 Classon Corp. (collectively, the “Pledged Entity”), and (ii) certain related rights and property relating thereto (collectively, (i) and (ii) are the “Collateral”). Secured Party’s understanding is that the principal asset of the Pledged Entity is that certain fee interest in real property commonly known as (i) 173 Lexington Avenue, Brooklyn, NY 11206; (ii) 701 Fulton Street, Brooklyn, NY 11207; (iii) 703 Fulton Street, Brooklyn, NY 11207; and (iv) 451 Classon Avenue, Brooklyn, NY 11238 (collectively, the “Property”).
• Maltz Auctions (“Maltz”), under the direction of Richard B. Maltz or David A. Constantino (the “Auctioneer”), will conduct a public sale consisting of the Collateral (as set forth in Schedule A below), via online bidding, on October 20, 2023 at 3:00pm, in satisfaction of an indebtedness in the approximate amount of $11,957,301.75, including principal, interest on principal, and reasonable fees and costs, plus default interest through October 20, 2023, subject to open charges and all additional costs, fees and disbursements permitted by law. The Secured Party reserves the right to credit bid.
• Please Note: Unlike Many UCC Foreclosure Sales, This is a Senior Loan!!!