Currently valued at $900 million, Castellan Real Estate Partners has invested heavily in residential and retail properties in New York and other metropolitan cities since 2008. Led by brothers Paul and John Salib, the company often targets mid-sized properties valued at $5 -$30 million. Committed to creating a margin-of-safety strategy when it comes to investment, Castellan Real Estate Partners structures deals that are highly profitable. In March 2017, Castellan sold five buildings in Harlem for $23 million to Aulder Capital, another real estate investment firm with portfolio holdings in Manhattan, Brooklyn, New Jersey, and Connecticut.
Encompassing a total of 100 residential units, the five buildings situated between Frederick Douglass Boulevard and Seventh Avenue were first acquired by Castellan for $11.1 million in 2013. The influx of residents to New York and the increasing demand for rental apartments, particularly in Harlem, made the investment extremely valuable. Although the buildings are comprised of one- or two-bedroom units only, they are occupied at 100 percent. With proper maintenance and consistent renovation to cater to younger demographics, the new owners can expect these buildings to rise in market value.
Noted for renovating its properties in line with best environmental practices, Castellan Real Estate Partners stands out as one of New York City’s most successful real estate investment and management companies. Since 2009, it has closed $875 million in deals based in debt and equity acquisitions. Moreover, Castellan Real Estate Partners continues to collaborate with city agencies that work to improve the energy efficiency of buildings and to reduce their carbon footprints.
Among these partner agencies is the city’s Department of Housing Preservation and Development. In operation for close to 40 years, HPD now serves as the largest city-based preservation and development agency for housing in the United States. Its charge: to encourage the growth of housing that is excellent in quality while keeping it within the financial reach of low- and medium-income citizens.
Through its work with New York’s mayor’s office, HPD engages in the monitoring and enforcement of the appropriate standards for housing and the preservation of significant buildings. Its financial initiatives include tax and loan incentives for property owners who reciprocally agree to keep rents for current and near-future tenants affordable. Its work has proven especially critical for senior adults and families transitioning away from homelessness.
The agency concentrates particularly on the construction and support of housing in communities known for their cultural diversity.
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.