JDS, Chetrit land $135M loan for Brooklyn’s tallest tower

Bank of the Ozarks, Melody provided fresh debt

From left: Joseph Chetrit, a rendering of 9 Dekalb Avenue and Michael Stern
From left: Joseph Chetrit, a rendering of 9 Dekalb Avenue and Michael Stern

JDS Development and the Chetrit Group are one step closer to making their Downtown Brooklyn mega-tower a reality.

The developers secured a $135 million bridge and pre-development loan for the project at 9 Dekalb Avenue, sources told The Real Deal.

The loan, from Bank of the Ozarks and mezzanine lender Melody Finance, allows them to continue with early construction on the project, which began foundation work in January. The planned 73-story mixed-use tower is slated to house more than 400 rental apartments and would be the borough’s tallest tower at 1,066 feet.

The loan replaces debt provided by Kushner Companies and Fortress Investment Group, and means Kushner no longer has any involvement in the project, sources said. The partners are still in the market for a loan in excess of $265 million to help complete construction.

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The deal is just the latest in a long line of residential construction loans financed by Bank of the Ozarks, which was a small community lender in Arkansas before expanding across the nation and betting big on New York beginning in 2012. It has continued to actively finance new projects, despite other lenders pulling back from the market.

JLL’s Aaron Appel, who brokered the deal, said that while the condo construction financing market may be rough for developers right now, the market is still “liquid” for these types of deals.

“They have a very good land basis and put together a clever assemblage,” he said of the developers.

The deal was one of the first financed by Kushner Companies’ new lending arm. Laurent Morali, president of the firm, recently said the outfit plans to lend $200 million annually to developers over the next five years.

JDS CEO Michael Stern was not immediately available for comment on the Dekalb plans.