Brookfield closes on stake in $650M Waterside Plaza complex
Joint venture with Richard Ravitch landed $380M in debt: sources
Brookfield Property Partners purchased a stake in Richard Ravitch’s Waterside Plaza, a four-tower complex along the FDR Drive and East 25th Street, which valued the asset at $650 million, according to sources familiar with the deal.
Ravitch, the former New York lieutenant governor and Metropolitan Transportation Association head, built the complex with nearly 1,471 apartments in 1974 under the Mitchell-Lama affordable financing available at the time. But about 20 years ago he chose to exit the program and today the majority of the units are free market.
With an infusion of cash, the property could be “taken to the next level,” one insider said.
The complex includes about 50,000 square feet of commercial space, with much of that occupied by the British International School and several retailers. Insiders also pointed to the large outdoor space and a big garage that could be upgraded.
The joint venture landed approximately $380 million in debt from MetLife, sources said. Of that, $225 million has been recorded, and Brookfield is mentioned in one of the filings, a review of city property records found.
The size of Brookfield’s stake is unclear, and neither Brookfield nor Ravitch immediately responded to a request for comment.
Steven Kohn, Alex Hernandez and Adam Spies of Cushman & Wakefield arranged the debt for the venture, while Cushman’s Spies, Doug Harmon, Marcella Fasulo and Michael Collins brokered the deal.
The purchase extends Brookfield’s aggressive acquisition streak in New York City. It closed on the $165 million purchase of the 1,300-unit development project at 2401 Third Avenue and 101 Lincoln Avenue in the Mott Haven neighborhood of the Bronx last month, a deal that Spies and Harmon also brokered, along with Cushman’s Adam Doneger. The firm also went into a joint venture with Park Tower Group at Brooklyn’s Greenpoint Landing and, in a commercial investment, struck a 99-year lease with an option to buy with Kushner Companies for its 666 Fifth Avenue in Midtown.
About a dozen firms looked to partner with Ravitch at Waterside, including Vornado Realty Trust, SL Green Realty, Blackstone Group and Related Companies, sources said.
The city and Ravitch struck a deal in August to preserve the affordability of 325 units for the next 75 years, according to the local city council member. That deal was locked in as part of a plan to extend the ground lease for 99 years, which remains ongoing under the city’s uniform land use review process.
Invesco Real Estate signed a contract with AvalonBay Companies earlier this month to buy an 80 percent stake in five Manhattan rental buildings for $760 million, another deal brokered by Harmon and Spies.