[sparkling]

Plan for Tower in Brooklyn’s Greenpoint Waterfront Inches Forward

EMILY NONKO
Updated May 11, 2015

A partnership hoping to develop one of the first apartment projects on the Greenpoint waterfront in Brooklyn has taken a step closer to its goal by refinancing its debt with a $57.5 million loan from CIT Real Estate Finance.

The partnership, led by RedSky Capital LLC and JZ Capital Partners, used the proceeds of the loan to pay off debt it took on to purchase the 112,000 square feet of waterfront land at 18 India St.

RedSky and JZ Capital Partners formed a joint venture with the owner of the property in 2013, according to Matt Galligan, president of CIT Real Estate Finance.

The refinancing deal is the latest sign that the development boom on the Williamsburg waterfront is moving north. Construction is under way on another project, called Greenpoint Landing, which is set to include 10 buildings and a park.

The RedSky venture still needs construction financing to break ground. CIT hasn’t made any commitment to do that. But CIT executives said they are looking forward to continuing a relationship with the developer.

“We see Greenpoint as a natural extension of Williamsburg,” said Mr. Galligan.

Still, some aren’t so sure about the viability of new development because of transportation limitations. The only subway that serves the neighborhood is the G Train, which doesn’t go into Manhattan.

Mr. Galligan said the India Street parcel includes about 20,000 square feet of the India Street Pier, which RedSky built in anticipation of future development. It is currently being used as a terminal for the East River Ferry service, and people working on developing the area predict that Greenpoint will be increasingly served by water transportation.

Benjamin Bernstein, principal at RedSky, declined to comment. The Brooklyn-based development company already has an existing Williamsburg portfolio. In 2012, RedSky and Waterbridge Capital paid $66 million for a group of properties along the main drag of Bedford Avenue and has plans to develop retail and residential space.

RedSky’s joint venture plans to develop a 40-story residential tower on the Greenpoint waterfront when leases for the existing industrial buildings expire in the next two years, according to Mr. Galligan. Plans include market-rate and affordable rentals, as well as 100,000 square feet of retail space.

CIT, which is increasing its real estate lending activity, has been financing other projects in the outer boroughs, including a $44.8 million construction loan for a 114-unit rental building in Astoria, Queens. The firm is headed by John Thain, who formerly led Merrill Lynch and the New York Stock Exchange.

“With Manhattan land prices, it’s becoming harder to quantify rents, and have the rents make sense,” said Mr. Galligan. “The investment in Greenpoint seemed natural.”


The site of the proposed apartment project, which is highlighted. PHOTO: CHRISTIAN GARIBALDI/GARIBALDI IMAGINEERING