New York-based Castellan Real Estate Partners, co-led by Managing Director John Salib, has made a name for itself in one of the world’s most competitive real estate investment markets. John Salib helps lead a team of savvy professionals at Castellan Real Estate Partners and its financing arm, Castellan Capital.
The firm is offering rapid underwriting and closing of bridge loans in prominent real estate markets like New York, Miami, Boston, Los Angeles, and San Francisco. It also offers construction loans, only in New York. Due to its large amount of private capital and an in-house investment committee, Castellan can offer flexibility in structuring transactions to meet each client’s individual investment needs.
A high-profile bridge transaction the firm recently handled was a $4.5 million bridge-to-HUD (Housing and Urban Development) loan that was used to refinance nearly two dozen multifamily properties in Hartford, Connecticut. Twenty-three separate buildings, subject to a Housing Assistance Payment (HAP) contract, were included in the refinance loan. The borrower was able to withdraw equity and refinance the property much faster and more conveniently than through a traditional HUD transaction.
Castellan Real Estate Partners was established in New York City in 2009 by cofounder John Salib. For more than eight years, the Castellan Real Estate team has acquired, refinanced, and sold a number of notable properties.
The firm recently sold a four-building East Harlem property to Isaac Kassirer, head of Emerald Equity Group. The acquisition is another signal of Emerald Equity’s desire to increase the organization’s presence in the local multifamily real estate market. Emerald acquired the property for just under $25 million, close to double what Castellan paid for the property just five years ago.
The East Harlem property, which includes three buildings along East 117th Street and a fourth building at 1661 Park Avenue, is comprised of more than 100 residential units. The three East 117th Street properties sold for $15.8 million and consist of 42,000 square feet and 74 residences. The fourth building sold for an estimated $9 million and will provide Emerald with an additional 22,000 square feet and 34 rental units, as well as a retail location.
Based in New York and led by Paul and John Salib, Castellan Real Estate Partners seeks out opportunistic development, property asset management, equity investment, and lending pathways. In August 2017, Castellan Real Estate Partners announced the $25 million sale of an East Harlem portfolio spanning four buildings to Emerald Equity Group, which is led by investor Isaac Kassirer.
The high-profile transaction encompassed $15.8 million paid for three East 117th Street properties spanning 42,000 square feet. With two of the buildings contiguous, they cumulatively offer two commercial units and 74 rental units. In addition, Emerald acquired the 22,000-square-foot property 1661 Park Avenue, which encompasses a retail unit and 34 rental units.
Situated in locations that are increasingly “on the radar” of those seeking multifamily properties, the buildings’ residential units are more than 90 percent rent-stabilized. Particularly in East Harlem, the expectation is that rents have substantial room for growth. With investments continuing to funnel in, a proposed rezoning that is within a public review process would allow residential density and new retail opportunities.
With Castellan having purchased all four walk-up prewar buildings in 2013 for $13.5 million, the company made a significant profit on the transaction.
Under John Salib’s management, Castellan Real Estate Partners has grown to become a vertically integrated real estate firm with business lines devoted to investment, development, lending, and property management. To mitigate high energy costs in apartment buildings under its management, Castellan Real Estate Partners installs energy efficient lighting.
The average American household dedicates up to five percent of its annual budget to lighting. Making the switch to ENERGY STAR certified energy efficient light bulbs can easily lead to significant savings. These bulbs include compact fluorescent lamps (CFLs) and light-emitting diodes (LEDs).
CFLs are compact versions of the long fluorescent tube lamps and are available in a range of sizes and colors. Typically, an ENERGY STAR certified CFL uses one-quarter of the energy a traditional bulb uses to generate the same amount of light. It can also last up to nine times as long.
LEDs are by far the most common energy saving bulbs in the market. Previously used as indicator lights in vehicles, the bulbs have found a more widespread use in general illumination. And they are very efficient. An ENERGY STAR certified LED uses only 20 percent of the energy used by traditional bulbs to produce an equivalent amount of light and burns 25 times longer. Some LEDs have also been tested and approved for outdoor use; hence they can be used as pathway lights, floodlights, and porch lights.
Both CFLs and LEDs are more expensive than traditional bulbs. However, the energy savings they lead to can significantly reduce electricity bills as well as cut carbon emissions.