Brooklyn North Capital and RiverBrook Equities have closed on a $48.5 million inventory loan for their 43-unit Kips Bay condo development from lender Northwind Group.
The two-year loan recapitalizes the project, which previously received $46 million in financing from S3 Capital Group in 2018.
After its expected completion later this year, the 11-story building at 165 Lexington Avenue is aiming for a sellout of $82 million, with units asking between $800,000 and $3.5 million, according to the offering plan. There is also about 4,000 square feet of retail space at the ground floor.
Ryan Serhant’s team at Nest Seekers International is handling marketing and sales. (The celebrity broker continues to work through his team at Nest Seekers for projects that began before he launched his new brokerage last year.)
Northwind’s inventory loan comes from its $220 million debt fund raised last year. The fund targets special situation loans in New York City, about 80 percent of which have been on residential projects, condos or multifamily buildings, according to managing partner Ran Eliasaf.
The loan at 165 Lexington is notable because the project has not finished construction and sales have not begun, which can deter some lenders. Eliasaf said he was comfortable because he’s confident the units will sell well at their price point. Sales are expected to begin this fall once construction is complete.
“In Manhattan, under $3 million is a very active market,” he said. “It’s a good middle-market project that we think is going to do very well.”
Meridian Capital Group’s Alex Bailkin and Morris Betesh brokered the financing.
New development sales this year have hit record highs as developers have lowered prices at some projects. In Manhattan, newly built condo inventory has dropped 11.5 percent from the number of units on the market in 2019, according to a recent report by Brown Harris Stevens’ new development marketing division.