UPDATED, 10:52 a.m., Feb. 8: Normandy Real Estate Partners and Jonathan Zamir’s Keystone Equities scored $81 million in acquisition and construction financing for their long-awaited office conversion of a Long Island City warehouse, sources told The Real Deal.
Rendering of 25-11 49th Avenue in Long Island City
After 17 months in contract, the developers finally closed on the $39.1 million purchase of a low-rise industrial building at 25-11 49th Avenue, sources said. At the same time, they secured a mortgage from Deutsche Bank, allowing them to break ground right away. Of the $81 million, $30 million went toward the purchase and the rest will be project funds. The firms closed the deal in partnership with Stuart Milstein’s Drake Street Partners and another unidentified investor, sources said.
Plans call for the vacant two-story, 135,000-square-foot loft-style property to be converted and expanded into one with 11 stories and 238,000 square feet. The developers expect to complete the project by summer 2019, sources said.
Newmark Knight Frank’s Dustin Stolly and JLL’s Aaron Niedermayer brokered the financing. A Cushman & Wakefield team led by Adam Spies, Adam Doneger and Josh King represented the buyers in the acquisition. Marcus & Millichap’s Jakub Nowak and Jonathan Eshaghian and Venture Capital Properties’ Joseph Soufeh represented the sellers.
From left: Jakub Nowak, Dustin Stolly and Adam Spies
Normandy, Keystone, Marcus and Newmark declined to comment, and Candid Litho, Deutsche, Drake Street Partners and Cushman could not be immediately reached.
Normandy and Keystone agreed to buy the building from Candid Litho Printing in September 2016. Sources familiar with the deal said the delay in closing was due in part to the search for financing and to a condition that the building’s five tenants – including Candid Litho, the largest tenant – vacate prior to closing.
Normandy, a New Jersey-based investment firm that frequently repositions office properties, is redeveloping another warehouse in Long Island City, at 43-10 23rd Street. The firm paid $54 million for a stake in the property last year.