Jonathan Rose, BedRock close $144M financing package for BK Heights rental

Chinese private equity firm JD Capital brings more than $90M to the table

Renderings of Pierrepont Apartments and Jonathan Rose
Renderings of Pierrepont Apartments and Jonathan Rose

Jonathan Rose Companies and partner BedRock Real Estate Services will go vertical on their 86-unit Brooklyn Heights rental development after locking down $144 million in construction financing and additional equity from a Chinese institutional partner.

With the foundation already laid at the partners’ Pierrepont apartment project, vertical construction can now begin after the development team brought on the Beijing-based private equity firm JD Capital as a long-term partner.

JD Capital contributed more than $90 million in equity to the project, and the developers secured a $50 million construction loan from Santander Bank, retiring about $28 million of previous debt on the property.

Construction of the 160,000-square-foot 80/20 rental building is scheduled to be completed in about two years.

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“There’s a lot of building in Downtown Brooklyn, but there are not a lot of sites in Brooklyn Heights of this size,” Jonathan Rose Companies [TRDataCustom] COO Mike Daly told The Real Deal. “That makes this a great long-term value proposition.”

Construction financing is harder to come by as banks have gotten more skittish about getting into ground-up development. But Daly said that at Jonathan Rose’s typical debt ratio of 40 percent leverage, the deal “is a more conservative loan for a lender.”

The project will comprise of a pair of 19-story buildings facing Montague and Pierrepont streets connected at a two-story base. Most of the units will be family-sized two- or three-bedrooms with full-floor apartments on the tower floors.

Jonathan Rose paid around $57 million between early 2015 and March 2016 to assemble three properties at the site: 181 and 189 Montague Street, and 146 Pierrepont Street.

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