Lenders Poured Cash Into Multifamily Last Month

As high mortgage rates pushed up New York city rents, lenders put their money into luxury rental buildings last month. The asset class accounted for seven of the 10 biggest real estate loans made in December, including at TF Cornerstone’s two-tower Prospect Heights development near the former Atlantic Yards.

Nearby, Alloy Development’s all-electric tower in Downtown Brooklyn grabbed another large loan. Vanbarton’s Group’s office-to-resi conversion rounded out the top three, nabbing financing from Adi Chugh’s firm, which has become a go-to financier for real estate’s big developers.

TRD broke down December’s five largest loans in Manhattan and the top five in the outer boroughs:

Dean and dusted | $448M | Prospect Heights

PNC Bank provided a $448 million permanent loan to TF Cornerstone for its multifamily development at the southeastern corner of Pacific Park, the megadevelopment formerly known as Atlantic Yards. The seven-year, fixed-rate loan replaces the construction financing for the developer’s 798-unit project at 595 Dean Street, which is fully leased. The previous loan came from a consortium of lenders. The new financing is secured by the project’s three components, which technically comprise a condominium: rental apartments, a parking garage and commercial space. The residential units account for 78 percent of the condo, documents show.

Electric revenue | $290M | Downtown Brooklyn

New York Life Real Estate Investors provided $290 million for Alloy Development’s 505 State Street, the first all-electric tower in New York City. The 44-story Brooklyn rental building was completed in July. The permanent financing replaces a $210 million construction loan from Goldman Sachs and Related Companies. The deal marks the exit of preferred equity partner Ares Management and establishes Alloy as the sole equity stakeholder. Alloy CEO Jared Della Valle called it a “significant milestone.”

Ch-ch-Chugh! | $280M | Financial District

TYKO Capital provided a $280 million acquisition and construction loan for Vanbarton Group’s residential conversion at 77 Water Street. Vanbarton, headed by Richard Coles and Gary Tischler, closed in December on its $95.5 million purchase of the 26-story Financial District office tower from Sage Realty, the management arm of the William Kaufman Organization. The 1970s-era 77 Water could yield as many as 600 apartments.

Ritzy refi | $232M | Midtown

Ares Commercial Real Estate Management provided $232 million to Carlyle Group for the 43-story Midtown luxury rental tower known as the Ritz Plaza. The fresh financing replaced a $235 million loan from Deutsche Bank, issued in 2019 when the Carlyle Group bought a majority stake 1980s-era, 479-unit complex. Carlyle Property Investors, the real estate fund sponsored by the private equity firm, acquired an approximate two-thirds stake in the tower at 235 West 48th Street from entities tied to Ivanhoe Cambridge and SL Green Realty. The move brought the firm together with long-time owner Stonehenge.

TF Cornerloan | $205M | Long Island City

M&T Realty Capital provided a $205 million Fannie Mae loan for TF Cornerstone’s 584-unit apartment tower in Long Island City. The 26-story building at 46-10 Center Boulevard — which has 585 units and curves around the famous PepsiCo sign — was completed in 2014 and was the last of the developer’s decade-long, $1.4 billion effort to add roughly 3,000 new residential units to the area. The buildings were part of a plan, which originated in the 1980s, called Queens West. The loan features a 35-year amortization schedule and full-term, interest-only payments, according to Rebusiness Online.

High note | $165M | Herald Square

Sail Harbor Capital provided $165 million for American Exchange Group’s acquisition of the note for 1375 Broadway. Alen Mamrout’s firm took ownership of the Herald Square office building from Savanna before the new year, the Commercial Observer reported. It secured ownership by acquiring the $200 million debt behind the property in August from Aareal Capital. The note was converted to a first mortgage after closing.

Milk money | $140M | East New York

MF1 Capital provided $140 million to Bushburg and the Moinian Group for their 14-story transformation of a Brooklyn dairy factory. The fresh financing replaced the $130 million in debt the developers used to expand and convert the building into a 320-unit, mixed-use project. The new, floating-rate financing comes two years after a $105 million loan from Valley Bank and Cross River Bank and $25 million gap mortgage funded the of the landmarked buildings, which pre-date World War I.

Lucky Goose | $132M | Downtown Brooklyn

Affinius Capital provided $132 million for Goose Property Management’s luxury multifamily project in Downtown Brooklyn. Yitzchok Katz’s firm scored the construction loan for the 297-unit development, which is slated for completion in late 2027. The project, between Flatbush Avenue and Nevins Street, will have studios, one- and two-bedroom apartments. There will also be 5,000 square feet of commercial space on the ground floor.

Rehab refi | $124M | Upper West Side

Greystone provided $124 million to Argent Ventures for The Riverside, a rehabilitation center at 150 Riverside Drive. The fresh financing replaced an $81 million loan from NewPoint Real Estate Capital. Argent bought the rehab center for $66 million in 2013,

RXR Recap | $110M | Midtown

ING Capital provided $110 million for RXR’s 475,000-square-foot office property at 530 Fifth Avenue. The owners recapitalized the property after Sagehall, run by Lanee Yung and Extell Development veteran Sush Torgalkar, joined the ownership group, the Commercial Observer reported. They are injecting $70 million of capital into the building while also taking out the five-year loan. The property is the flagship location of flex space provider Convene, which occupies 116,000 square feet.