Turnbridge Equities and Dune Real Estate Partners recently notched a rare find, nabbing a site in Brooklyn to begin ground-up construction of a warehouse.
The real estate firms bought two vacant warehouses at 807 Bank St and 300 DeWitt Ave in Brooklyn’s Canarsie neighborhood from two separate sellers, according to Turnbridge Equities’ Ryan Nelson. The price on the deal came to $22.5 million.
The developers plan to tear down the existing properties and build a 170,000-square-foot development with an 80,000-square-foot last mile warehouse and 90,000 square feet of parking space. The site will be built on spec, meaning it has no tenant in place.
Starwood Capital Group provided a $49 million loan for the acquisition and construction of the site, according to Nelson.
Construction is expected to begin in May and the project is planned to be finished in the second quarter of 2023.
The warehouse will include four full-size loading docks, eight drive-in doors and 18-foot clear heights. It sits minutes away from the L subway and near warehouses used by Amazon, UPS, and FedEx.
The pandemic accelerated the rise of e-commerce, making industrial New York City’s hottest asset class and spiraling the number of available sites.
In addition to the existing land shortage, some sites zoned for industrial are being rezoned for residential development in areas like Gowanus. The tight market has meant investors are facing staggering prices for properties amid intense competition from larger institutional investors such as Blackstone or Prologis.
Blackstone recently bought a 112,800-square-foot factory building at 906 Wortman Avenue in New Lots, Brooklyn, for $35.5 million. Prologis bought a 31,500-square-foot warehouse at 280 Johnson Avenue in East Williamsburg for $27.5 million.
Turnbridge and Dune filed plans last year to build a massive industrial project in the South Bronx. The venture plans to build a 1.2 million-square-foot industrial development on East 149th Street in Port Morris, which will include about 879,000 square feet of warehouse space.