A massive last-mile distribution center may have reached the last mile of its financial needs.
A joint venture controlled by Turnbridge Equities and Dune Real Estate Partners has secured $381 million in new financing from KKR, property records show.
Most of the funds will be used to construct the distribution center in Hunts Point, Bronx. It will be about 1 million square feet.
The two-story facility is slated for nearly 630,000 square feet of land next to the East River below East 149th Street, near the Bruckner Expressway. The loans from KKR provide $224.5 million for construction and $94.7 million in new senior debt, and will retire $61.8 million in outstanding principal originated by JPMorgan Chase.
Turnbridge, led by Andrew Joblon, has been busy scooping up industrial property including a 129,000-square-foot warehouse last year in Queens for $39.5 million, and a 1-million-square-foot industrial site in New Jersey for $61 million.
Turnbridge began assembling the Bronx site in 2018, spending a total of $174 million for the purchase of five parcels, property records show. In May, it filed an application to construct a 986,000-square-foot warehouse at 950 East 149th Street.
KKR and Turnbridge declined to comment on the project’s financing, which was arranged by JLL Capital Markets. JLL’s team included Christopher Peck, Peter Rotchford and Madison Warwick. Andrew Scandalios and Tyler Peck arranged the equity partnership.
KKR, a publicly traded company, manages real assets as well as private equity investments. It devotes half its loan portfolio to multifamily properties, 33 percent to offices and just 3 percent to industrial buildings, according to its website.
But the market for last-mile delivery centers has been hot for several years and scorching since the pandemic hit. Consumer behavior has steadily trended toward delivery and away from in-person shopping, a trend supercharged by Covid and a race for ever-faster delivery.
The driving force behind it, of course, is Amazon, which seeks to open 100 industrial facilities in the U.S. this month and hire 125,000 warehouse workers ahead of the holiday season.
One of the retail giant’s many recent such plans is for a 64,000-square-foot facility at 49 Wireless Avenue in Hauppauge’s Long Island Innovation Park that could accommodate 186 delivery vans.