The Real Deal New York

Flank buys Carlyle out of Brooklyn Hilton project

Developer also secured $70M bridge financing
November 21, 2016 02:45PM

Renderings of The Boerum at 265 State Street in Brooklyn

Renderings of The Boerum at 265 State Street in Brooklyn

Flank is buying the Carlyle Group out of their jointly developed Brooklyn Hilton hotel in Boerum Hill. As part of the deal, the architecture and development firm is refinancing the 196-key hotel with a $55 million senior bridge loan from M&T Bank and a $15 million mezzanine loan from Terra Capital, according to the Wall Street Journal.

Carlyle TRData LogoTINY and Flank had reportedly planned to sell the hotel earlier this year.  The hotel, which is set to open this year, is part of Flank and Carlyle’s hotel, retail and condo development The Boerum at 265 State Street. It includes 128 condo units, with sales having launched in December 2014.

The two firms bought the site for $38.5 million in 2012 and landed a $175 million construction loan last year.

Flank’s success in refinancing the hotel is noteworthy because lenders have shied away from hospitality construction lately amid fears of oversupply. According to the Journal, the Brooklyn hotel market is doing better than its Manhattan counterpart because the borough’s surging popularity has yet to be met with a surge in new rooms. [WSJ]Konrad Putzier