All Year nears $650M financing for Bushwick luxury rentals
Refi from Goldman Sachs and Citi Real Estate was in the works before the pandemic
UPDATED, Oct. 29 2020, 3:25 p.m.: All Year Management is closing in on a major financing deal for a luxury apartment complex built on the site of the former Rheingold Brewery in Bushwick.
The Brooklyn development firm, led by Yoel Goldman, is negotiating $652 million in financing from Citi Real Estate Group and Goldman Sachs that will largely be used to refinance the 900-unit complex, known as Denizen Bushwick.
All Year will use most of the proceeds of the loans to refinance $371.3 million of existing debt on its Brooklyn apartment and commercial portfolio, along with paying down $247.4 million in secured Tel Aviv Stock Exchange bonds, according to a report by DBRS Morningstar which assigns preliminary ratings for the yet-to-be-finalized transaction.
The loan consists of a $510 million five-year mortgage loan with senior and junior positions, as well as a $160 million mezzanine loan. The average weighted interest rate of the loans is 4.98 percent, but the mezzanine interest rate was 9.1 percent, according to DBRS Morningstar.
In February, before the onset of the pandemic, the firm had signed a memorandum of understanding for $675 million in refinancing on the complex.
All Year’s portfolio includes 1,198 multifamily units and 184,179 square feet of commercial space, with properties in Bushwick, Williamsburg and Bedford-Stuyvesant. Denizen Bushwick, located at 54 Noll Street and 123 Melrose Street, is the portfolio’s largest asset.
The firm purchased the two sites that make up the complex in 2015 and 2016 for $68.5 million and $72.2 million, respectively. In June 2019, All Year scored $235 million in financing from JPMorgan and Mack Real Estate Group for the second phase of the project. The project was completed in two phases in 2018 and 2019.
All Year has previously faced scrutiny over the project’s finances. In March, Israeli candy manufacturer Toot Food Industries Ltd., which holds a short position in All Year’s bonds, filed a legal action against the firm. The company alleged that All Year violated Israeli securities law, and wanted the firm to give its bondholders back the building rights to the first phase of the Denizen project.
All Year Management also owns the William Vale hotel in Williamsburg, but announced last year that it would try to either refinance or sell the complex to pay off some of its bonds.
CORRECTION: This story originally stated that All Year had closed on financing for Denizen Bushwick. The deal has not yet closed.