Brookfield pays $45M for Red Hook Amazon facility

Firm acquired 99-year ground lease at 55 Bay Street from Dov Hertz

55 Bay Street in Red Hook and Brookfield Properties CEO Brian Kingston (Google Maps, Brookfield)
55 Bay Street in Red Hook and Brookfield Properties CEO Brian Kingston (Google Maps, Brookfield)

Brookfield Properties has reportedly made a new industrial play in Red Hook, Brooklyn, picking up a warehouse Amazon Fresh uses for its grocery delivery service.

The real estate investment firm acquired the 99-year ground lease at 55 Bay Street in the Brooklyn neighborhood for $45 million, according to the Commercial Observer. The seller was Dov Hertz’s DH Property Holdings.

DH Property Holdings kicked off construction on the 85,000-square-foot warehouse in 2018, a year after acquiring the site from Red Hook Park. During construction, Amazon reportedly inquired about taking the entire warehouse for cold storage and a distribution facility.

Amazon began leasing the property in November 2020, when it was still under construction, the Observer reported. Work was completed in September 2021, after which Amazon began delivering groceries out of the hub.

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Rob Kossar of JLL was part of the team that brokered the sale.

The sale at 55 Bay Street doesn’t mean Hertz’s relationship with Amazon in Red Hook is coming to a close. According to the Observer, DH Property Holdings is developing a 336,000-square-foot warehouse at 640 Columbia Street. Amazon reportedly leased the space earlier this year.

This is at least the second industrial buy Brookfield Properties has made in recent weeks. The firm also bought a 12-acre property in southeast Los Angeles County from Interstate 5 Firestone for between $55 million and $60 million. The La Mirada industrial facility is fully leased to one tenant.

Elsewhere in Red Hook, a warehouse at 280 Richards Street is entirely pre-leased to the e-commerce giant. Joe Sitt’s Thor Equities nabbed $76 million in construction financing earlier this year for the property, in addition to a $155 million joint venture equity recapitalization.

Amazon agreed to a 20-year deal with Thor in 2020 for more than 311,000 square feet.

[CO] — Holden Walter-Warner