This Week’s N.Y. Deal Sheet
Retail was the most active category in New York City's leasing market this week, with a smattering of leases in Manhattan and Brooklyn. This week’s financing deals focused on housing and mixed developments, capitalizing the final 421-a projects currently underway.
TOP FINANCING
Innovo Property Group scored a $345M financing package from Axos Bank and Cerberus Capital Management for an industrial project in Long Island City, according to a release. Innovo and Goldman Sachs Asset Management’s Urban Investment Group provided the equity on the deal, while Axos and Cerberus provided the construction loan for the development, located at 28-90 Review Ave. The developer plans to create an industrial warehouse facility with on-site electric vehicle parking. Innovo acquired the site from JBL Asset Management for $34M in June 2020. Innovo is planning to build a six-story, 682K SF warehouse, The Real Deal reports.
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A joint venture between Lonicera Partners and Rabina has nabbed a $128M loan, plus equity, for its 55 Willoughby project, a 268K SF mixed-use development in Downtown Brooklyn, according to a release. The floating-rate loan came from Santander Bank and City National Bank, with The Davis Group providing an undisclosed equity sum. The development is one of the last to use the expired 421-a tax break, bringing 295 units, 89 of which will be income-restricted, to the neighborhood atop 3K SF of retail space. The developers are targeting younger renters and students at nearby higher education institutions. A JLL debt and equity advisory team of Jeffrey Julien, Chris Peck, Nicco Lupo, Rob Hinckley, Geoff Goldstein, Marko Kazanjian and Alex Staikos repped the sponsor.
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Century Development Group landed a $69M loan for a 115-unit condo project planned at 11-36 45th Road in Long Island City, Commercial Observer reported. Century purchased the site from Radha Soami Society Beas, an Indian religious organization, for $26M in 2019. The seven-story condo building would feature community space, 23K SF of ground-floor commercial space and 59 parking spots. Meridian Capital Group's Morris Betesh and Omar Ferreira arranged the transaction between Century, mezzanine lender Be Aviv and senior lender BHI, the U.S. division of Bank Hapoalim.
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BHI has agreed to lend $29.25M to an LLC building a seven-story, mixed-use development, according to a release. The construction loan was awarded to ZD Jasper Realty for 138-45 Jamaica Ave. in a direct deal, and will be used to add 81 residential units — 30% of which are earmarked for affordable housing — as well as a retail space and on-site parking.
TOP SALES
Boston-based firm TA Realty has sold a Diamond District office property at a 51% loss, Crain’s New York Business reported. Empire Capital Holdings purchased the seven-story, 22K SF building at 1200 Sixth Ave. for $22.3M — well below the $43M a TA Realty LLC paid in 2017. The property, built in the 1960s, was renovated in 2000. Three jewelers are on the property’s ground floor and a wholesale jeweler has 3K SF on the third floor.
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The Columbus Circle building once home to the DuArt film studio has sold for $29M to New Jersey-based investor Mandelbaum & Mandelbaum, Crain’s New York Business reported. JLL listed the property on behalf of seller Du-Art Film Laboratories for $48M in November, placing the sale price at roughly 60% of the initial asking price. Du-Art had locked in a $6M mortgage for the 12-story, 70K SF property in July 2020 from Signature Bank, whose loans are now being sold after the bank failed in March. The property has several tenants, including media production firms Avant Garde Entertainment, Nel Shelby Production, Manhattan Production, Jarrett Creative Group and Standby Program, which have been at the 245 West 55th St. property since 2020.
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CAVU Property Group has purchased a development site in a Brooklyn opportunity zone for $12.8M, according to a release. The Jackson Group was the seller of 2251 Nostrand Ave., which has 74K SF of buildable SF as-of-right, which increases to 92K SF if CAVU builds a community facility. The sale price for the site, which is between Flatbush and Midwood, works out at $170 per SF. Ariel Property Advisors’ Sean Kelly, Lawrence Sarn and Shimon Shkury brokered the deal.
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Investor and property management group Rockledge CRE has purchased two contiguous walk-up buildings in Harlem for $11.35M, according to a release. The five-story buildings are located at 401-405 Edgecombe Ave. and were sold by Peter Takiff, who a spokesperson said was a different person than the Peter Takiff currently serving as a partner at Rockledge. The buildings sold for a 5.91% cap rate at $311 per SF, or a gross rent multiplier of 8.58 times the current rent roll. Rosewood Realty Group’s Aaron Jungreis, Ben Khakshoor and Alex Fuchs repped Rockledge, while Newmark’s Brian Ezratty represented Takiff.
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Developer Lam Group sold 229 Duffield St. to a women's housing nonprofit for approximately $40.9M, according to a release. The former hotel has approximately 130 rooms that The Webster Apartments will use to create housing for approximately 160 women in single and double rooms. The Downtown Brooklyn facility will include furnished rooms, communal spaces, on-site food, a gym and laundry as well as 24-hour security and expects its first move-ins to take place in Q3 2025. OPEN Impact Real Estate’s Lindsay Ornstein, Stephen Powers, Amy Lawrence and Alexander Smith repped The Webster Apartments in the deal.
TOP LEASES
Revel, the ride-share and scooter rental service, has signed a new lease at 31-00 47th Ave., a Long Island City property known as the Falchi Building, Commercial Observer reported. Revel has signed 8K SF and moved 40 employees into the space as of last month, relocating from a smaller office in Pfizer’s former Bedford-Stuyvesant campus and plans to hire more W2 employees as drivers. The Falchi Building is a 658K SF property first built in 1922, acquired by Savanna and recently the subject of a $35M renovation. Mitch Arkin, Kelli Berke and Ethan Silverstein of Cushman & Wakefield represented Savanna in the transaction.
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Amsale, a bridal wear designer, is staying put at a 12K SF space in a Midtown GFP Real Estate-owned building, Commercial Observer reported. The designer signed a 10-year lease term at 318 West 39th St., where its 12th floor showroom has been located since 2005. The property, built in 1915, has 180K SF spread across 13 stories. Asking rents in the submarket were almost $77 per SF during Q1 2023, according to Cushman & Wakefield, but exact asking rents for Amsale’s space were not disclosed.
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Brooklyn-based events and catering company Marlow Events has signed a 12K SF lease at FM Capital’s 295 Front St., Crain’s New York reported. The 80K SF Vinegar Hill property is currently undergoing a redevelopment into Class-A office space, and will see updates to HVAC systems, elevators, windows and ancillary infrastructure. Jason Lloyd of Retail by MONA repped Marlow Events, while Chandler Slate and Eddie Keda of Tri State Commercial Realty repped the ownership in the lease, with asking rents at $70 per SF
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Fogo de Chão signed an 8K SF lease at City Point, Downtown Brooklyn's mixed-use shopping and entertainment hub, according to a release. The deal is part of the Brazilian steakhouse chain’s expansion, which has already seen it sign 12 leases so far in 2023 including in California and New Jersey with plans to sign in more locations before the end of the year. Fogo de Chão’s first NYC outpost was in Manhattan near the Museum of Modern Art, with the second location opening in Elmhurst close to the Queens Center shopping mall in November last year. Commercial Realty & Development represented Fogo de Chão in the deal for the spot, which will feature a center-restaurant grill for customers to watch chefs preparing copious amounts of meat.
