Commercial Real Estate
New York

Luxury rentals prove loan-worthy in outer boroughs

Office projects also scored some of the city’s biggest non-Manhattan loans in October

(One Boerum Place)

(One Boerum Place)

Lenders judged luxury rentals worth the risk and several office properties also made the list of the 10 largest loans issued in New York City’s outer boroughs last month.

The loans totaled $1.3 billion, down from $1.7 billion for September’s top 10. A year-ago comparison shows lenders extended nearly $2 billion over the largest financing packages in October 2020.

Brooklyn led the way last month with eight of the biggest property loans while projects in Queens secured two. Here is the list:

1. Luxury pivot | $277 million

Avery Hall, Aria Development and Allegra Holdings secured $277 million from QuadReal Property Group for their luxury rental project at 1 Boerum Place in Downtown Brooklyn, with Global Holdings contributing $40.5 million at the mezzanine level. The funds replace $165 million in construction loans from Jutland Finance, a subsidiary of Canadian pension fund British Columbia Investment Management. Developers indicated in May that they would construct a rental building instead of condos.

2. Wheeler dealer | $256 million

Barry Sternlicht’s Starwood Property Trust lent $255.6 million to Tishman Speyer on its Wheeler redevelopment, a 10-story glass addition above the landmarked Macy’s building in Downtown Brooklyn, with an additional $45 million at the mezzanine level. The funds replace $193 million from Bank OZK. In May, St. Francis College signed a 30-year lease for 255,000 square feet at the building, partly replacing a 2020 agreement by Whittle School and Studios to occupy all 622,000 square feet.

3. Them apples | $202 million

Bank of America provided John Catsimatidis’ Red Apple Group with a $202 million refinancing package for its Downtown Brooklyn luxury rental project the Eagle, replacing $200 million issued by Santander Bank in 2019. Red Apple completed the 32-story tower at 86 Fleet Place, the last piece of Catsimatidis’ four-building development along Myrtle Avenue, in 2017. The other three buildings are named after his family members.

4. On spec | $138 million

Edward J. Minskoff Equities secured a $138 million mortgage loan from insurance giant AIG for its speculative office building at 29 Jay Street in Dumbo, Brooklyn. The loan includes $97 million for construction and replaces a $40 million acquisition loan originated by Bank of America. Minskoff bought the property in March 2020 for $61.5 million and plans to construct a 220,000-square-foot building.

5. CIM city | $110 million

CIM Group and LIVWRK’s Dumbo luxury development at 85 Jay Street secured $110.4 million in construction financing from JPMorgan Bank and Mack Real Estate Credit Strategies. The 1.1-million-square-foot residential development includes 131,000 square feet of retail and 408 condominiums, plus 320 rental units which RXR entered into contract to buy in April for $220 million. The development has received about $655 million in mortgage loans since it was acquired in 2016 for $345 million, records show. Condo sales at the building have been among the priciest residential sales in Brooklyn.

6. 38 townhouses | $78 million

GDC Properties refinanced debt on its rental townhouse development at 45-35 11th Street in Long Island City with a $77.9 million mortgage consolidation loan from JPMorgan Chase. The loan replaces $76 million from Granite Point Mortgage Trust, a mortgage REIT, which lent the funds in 2019 to help complete the project, replacing construction financing that Santander Bank issued in 2016.

7. Green Meadow | $68 million

Meadow Partners secured $67.9 million in mortgage loans from Fortress Investment Group at 57 Willoughby Street in Downtown Brooklyn. The funds include $8.5 million in new construction financing and will replace $40 million issued by Square Mile Capital in 2019. Meadow bought the 105,000-square-foot office building, which headquarters the nonprofit Helen Keller Services for the Blind, in 2016 for $54 million.

8. Mind the gap | $56 million

The Treeline Companies refinanced its debt at 195 Montague Street in Brooklyn Heights with a $55.8 million loan from Fortress, which includes $4.5 million in new debt as a gap loan. The loan at the 220,000-square-foot office condo building is secured by nine of the building’s 16 commercial condo units. WeWork occupies a unit on the building’s 14th floor. Treeline bought the condo units in 2015 for $20.8 million.

9. Debt and prayer | $54 million

MDG Design + Construction secured $54.3 million in development loans from New York City’s Housing Development Corporation and Hanson Place Seventh-day Adventist Church for its 13-story affordable housing project at 142 South Portland Avenue in Fort Greene, Brooklyn. Some community members had opposed the development, which will price 61 of 104 residential units below 60 percent of area median income, with the remainder affordable to households earning 60 to 140 percent of AMI, loan documents show. MDG simultaneously paid the Adventist Church $9 million to lease its property for the development.

10. Astor-nomical project | $53 million

Jason Halpern’s JMH Development refinanced its debt on the Astor LIC, a 143-unit luxury rental building at 36-20 Steinway Street, with a $52.5 million loan from Harbor Group International. The loan replaces $56 million in construction loans originated by Slate Property Group in 2019. JMH paid the property’s fee owner, the holding company that controls discount supermarket Western Beef, $19.6 million in 2016 to lease the property for development, when it had planned a hotel for the site.

COMPANIES AND PEOPLE

Tags
Commercial Real Estate
New York

Luxury rentals prove loan-worthy in outer boroughs

Office projects also scored some of the city’s biggest non-Manhattan loans in October

(One Boerum Place)

(One Boerum Place)

Lenders judged luxury rentals worth the risk and several office properties also made the list of the 10 largest loans issued in New York City’s outer boroughs last month.

The loans totaled $1.3 billion, down from $1.7 billion for September’s top 10. A year-ago comparison shows lenders extended nearly $2 billion over the largest financing packages in October 2020.

Brooklyn led the way last month with eight of the biggest property loans while projects in Queens secured two. Here is the list:

1. Luxury pivot | $277 million

Avery Hall, Aria Development and Allegra Holdings secured $277 million from QuadReal Property Group for their luxury rental project at 1 Boerum Place in Downtown Brooklyn, with Global Holdings contributing $40.5 million at the mezzanine level. The funds replace $165 million in construction loans from Jutland Finance, a subsidiary of Canadian pension fund British Columbia Investment Management. Developers indicated in May that they would construct a rental building instead of condos.

2. Wheeler dealer | $256 million

Barry Sternlicht’s Starwood Property Trust lent $255.6 million to Tishman Speyer on its Wheeler redevelopment, a 10-story glass addition above the landmarked Macy’s building in Downtown Brooklyn, with an additional $45 million at the mezzanine level. The funds replace $193 million from Bank OZK. In May, St. Francis College signed a 30-year lease for 255,000 square feet at the building, partly replacing a 2020 agreement by Whittle School and Studios to occupy all 622,000 square feet.

3. Them apples | $202 million

Bank of America provided John Catsimatidis’ Red Apple Group with a $202 million refinancing package for its Downtown Brooklyn luxury rental project the Eagle, replacing $200 million issued by Santander Bank in 2019. Red Apple completed the 32-story tower at 86 Fleet Place, the last piece of Catsimatidis’ four-building development along Myrtle Avenue, in 2017. The other three buildings are named after his family members.

4. On spec | $138 million

Edward J. Minskoff Equities secured a $138 million mortgage loan from insurance giant AIG for its speculative office building at 29 Jay Street in Dumbo, Brooklyn. The loan includes $97 million for construction and replaces a $40 million acquisition loan originated by Bank of America. Minskoff bought the property in March 2020 for $61.5 million and plans to construct a 220,000-square-foot building.

5. CIM city | $110 million

CIM Group and LIVWRK’s Dumbo luxury development at 85 Jay Street secured $110.4 million in construction financing from JPMorgan Bank and Mack Real Estate Credit Strategies. The 1.1-million-square-foot residential development includes 131,000 square feet of retail and 408 condominiums, plus 320 rental units which RXR entered into contract to buy in April for $220 million. The development has received about $655 million in mortgage loans since it was acquired in 2016 for $345 million, records show. Condo sales at the building have been among the priciest residential sales in Brooklyn.

6. 38 townhouses | $78 million

GDC Properties refinanced debt on its rental townhouse development at 45-35 11th Street in Long Island City with a $77.9 million mortgage consolidation loan from JPMorgan Chase. The loan replaces $76 million from Granite Point Mortgage Trust, a mortgage REIT, which lent the funds in 2019 to help complete the project, replacing construction financing that Santander Bank issued in 2016.

7. Green Meadow | $68 million

Meadow Partners secured $67.9 million in mortgage loans from Fortress Investment Group at 57 Willoughby Street in Downtown Brooklyn. The funds include $8.5 million in new construction financing and will replace $40 million issued by Square Mile Capital in 2019. Meadow bought the 105,000-square-foot office building, which headquarters the nonprofit Helen Keller Services for the Blind, in 2016 for $54 million.

8. Mind the gap | $56 million

The Treeline Companies refinanced its debt at 195 Montague Street in Brooklyn Heights with a $55.8 million loan from Fortress, which includes $4.5 million in new debt as a gap loan. The loan at the 220,000-square-foot office condo building is secured by nine of the building’s 16 commercial condo units. WeWork occupies a unit on the building’s 14th floor. Treeline bought the condo units in 2015 for $20.8 million.

9. Debt and prayer | $54 million

MDG Design + Construction secured $54.3 million in development loans from New York City’s Housing Development Corporation and Hanson Place Seventh-day Adventist Church for its 13-story affordable housing project at 142 South Portland Avenue in Fort Greene, Brooklyn. Some community members had opposed the development, which will price 61 of 104 residential units below 60 percent of area median income, with the remainder affordable to households earning 60 to 140 percent of AMI, loan documents show. MDG simultaneously paid the Adventist Church $9 million to lease its property for the development.

10. Astor-nomical project | $53 million

Jason Halpern’s JMH Development refinanced its debt on the Astor LIC, a 143-unit luxury rental building at 36-20 Steinway Street, with a $52.5 million loan from Harbor Group International. The loan replaces $56 million in construction loans originated by Slate Property Group in 2019. JMH paid the property’s fee owner, the holding company that controls discount supermarket Western Beef, $19.6 million in 2016 to lease the property for development, when it had planned a hotel for the site.

COMPANIES AND PEOPLE

Tags