Tag: Closed Deal
Mission Capital Structures a $23-Million JV Equity Investment for Largo’s Acquisition of Williamsburg Development Site
Buyer plans to develop a 105,000 square foot mixed-use property with luxury condos, office, retail and an automated parking garage
NEW YORK — Largo and Mission Capital Advisors announced that Mission Capital’s Debt and Equity Finance Group has structured a joint venture between Largo and First Atlantic Real Estate for the $25-million acquisition of 215 North 10th Street, an 18,000-square-foot corner development site in the North Williamsburg section of Brooklyn, New York. This North Williamsburg deal is the first investment that First Atlantic and Largo have partnered on and Largo’s ninth deal in Williamsburg. The Mission Capital team of Jordan Ray, Ari Hirt, Steven Buchwald and Jamie Matheny worked on structuring First Atlantic’s $23-million equity investment and has also been engaged to arrange the construction financing.
The JV has also purchased inclusionary air rights allowing for the development of a 105,000-square-foot, seven-story mixed-use property with approximately 31 luxury condominiums, 45,000 square feet of office, 7,000 square feet of retail and 85 parking spaces. Construction is expected to begin in the second quarter of this year.
“Largo is one of the most active developers in New York right now and really earned their stripes in Williamsburg early in this cycle, with this project being their ninth in the neighborhood. They know what product the market needs and can execute.” said Ray. “Raising JV equity for ground-up construction right now is challenging, but we are intimately familiar with the demand in the local market and were able to demonstrate that to First Atlantic. There really aren’t very many options for growing families to expand in north Brooklyn right now. There is a whole market of buyers who have lived locally and don’t want to leave the neighborhood because units that suit their needs don’t exist. Not only do they want to live in Williamsburg, but they want to work there as well, which has created a big demand for quality office space. Largo and First Atlantic saw a need and will fill it.”
About Largo
Largo is a private real estate development and investment firm founded by Nissim Ben-Nun and Nicholas Werner. Largo specializes in the acquisition, development, and operation of luxury multifamily and mixed-use real estate in New York City, and is currently heavily active in the Manhattan and Brooklyn markets.
Since its founding in 2009, Largo has successfully developed over 1.4 million square feet of luxury rental apartments, condominiums and mixed-use properties.
In addition, Largo provides construction management services for many of its projects through its construction management operation Largo Construction.
About Mission Capital Advisors
Founded in 2002, Mission Capital Advisors, LLC is a leading national, diversified real estate capital markets solutions firm with offices in New York City, Florida, Texas, California, and Alabama. The firm delivers value to its clients through an integrated platform of advisory and transaction management services across debt, mezzanine, and JV equity placement; commercial and residential loan sales; and loan portfolio due diligence and valuation. Mission Capital Advisors is extremely active in arranging financing for office, industrial, multifamily, retail and self-storage properties across the country. Since its inception, Mission Capital has advised a variety of leading financial institutions and real estate investors on more than $65 billion of financing and loan sale transactions, as well as in excess of $14 billion of Fannie Mae and Freddie Mac transactions, positioning the firm strongly to provide unmatched loan portfolio valuation services for both commercial and residential assets. Mission Capital’s seasoned team of industry-leading professionals is committed to achieving clients’ business objectives while maintaining the highest levels of integrity and trust. For more information, visit www.www.missioncap.com.
Mission Capital has arranged a $20.75m first mortgage ramp loan on behalf of SD Carmel Hotel Partners, an affiliate of Laurus Corporation, for the Hotel Karlan in northern San Diego.
Mission Capital arranges $20.75m for San Diego hotel
Mission Capital Advisors has arranged a $20.75m first mortgage ramp loan on behalf of SD Carmel Hotel Partners an affiliate of Laurus Corporation, for the Hotel Karlan in northern San Diego.
A ramp loan, which is primarily used to finance an asset that has limited in- place cash flow relative to its projected cash flow, is typically used as an intermediary step between construction and stabilization. “Construction financing can be more expensive and may include partial or even full recourse, depending on the deal, so a non-recourse ramp loan can remove a significant contingent liability from a sponsor’s balance sheet while also acting as an effective bridge from a construction or renovation loan to a more permanent loan,” said Gregg Applefield, director of the debt and equity finance group at Mission Capital. “In today’s market, it’s not uncommon for hoteliers to procure a ramp loan post- renovation, prior to securing permanent financing, and the sponsor turned to us because of our extensive experience in this arena.”
The 174-key, soft- branded DoubleTree by Hilton property has undergone a multimillion dollar renovation since it was acquired by the sponsor in 2014, including a remodeling of guestrooms, new dining spaces, including a San Diego-influenced brew pub, an upgraded spa with a fitness center, and two pools with outdoor cabanas. “We’re confident that our large-scale improvements have taken the property to a higher level, establishing it as a leader among resort hotels in the area,” said Peter Ciaccia, chief commercial officer at Laurus Corporation.
The three-year first mortgage loan, which will replace the property’s renovation loan and a preferred equity loan, was made by an undisclosed private equity fund. Mission Capital approached a variety of lenders to allow the sponsor to refinance and pay off its existing debt and allow it the time to ramp up its net operating income, according to Applefield. “Through a strong marketing effort, we were able to provide the sponsor with numerous competitive offers, including fixed-rate and floating-rate options with very high leverage for a hotel,” he added.
Laurus Corporation is a real estate investment and development company that has over $1.2b in assets under management. The firm focuses on creating capital appreciation opportunities through repositioning, restructuring, redeveloping, and intensively managing assets post-acquisition.
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