Citigroup Lends $110M for New Jersey Multifamily Buy
The New York-based real estate firm Castle Lanterra Properties received $110 million in acquisition financing from Citigroup (C) Global Markets Holdings for the purchase of a 544-unit multifamily complex in Bayonne, N.J., Commercial Observer has learned.
The fixed-rate acquisition financing, which closed on Oct. 19, carries a 75 percent loan-to-value ratio over a 10-year, interest-only term, said Elie Rieder, the founder and chief executive officer of Castle Lanterra. JLL Managing Director Aaron Appel and Senior Vice President Jonathan Schwartz brokered the debt deal.
“This was the best financing package for us because it is aligned with our long-term strategy for Harbor Pointe,” Mr. Rieder told CO via email. “We plan on owning the property for many years and the fixed-rate debt provides us with a clear understanding of our debt-related expenses over the next 10 years. The full-term interest-only is very attractive to us and no other lender was able to offer it.”
The New York-based real estate firm bought the property, Alexan CityView—which its new owners are renaming Harbor Pointe—at 300 Constitution Avenue, from Dallas-based Trammell Crow Residential and AIG Global Real Estate for $147.5 million in a deal that closed on Oct. 21, according to recent reports.
“Alexan CityView is a high-quality asset offering proximity to New York City but at a more affordable cost, and lenders recognized the opportunity at hand,” Mr. Appel noted in prepared remarks provided to CO.
The complex, which is located near the town’s waterfront on the Bayonne peninsula, contains a swimming pool, two parking garages, a basketball court, and a gym, and was constructed five years ago.
“We are strong believers in the area. While Harbor Pointe was probably built five years too early, now is the time to purchase in the Bayonne peninsula,” Mr. Rieder said. Several multifamily projects and a 53-acre mixed-use development, as well as infrastructure services including a ferry to Downtown Manhattan, will be coming to the area in the next five years, he added.
Mr. Rieder shared the sentiment, and said that the property’s close access to New York City and Jersey City Exchange Place via the light rail was crucial to their investment decision.
Alliance Residential will manage the property.
A representative for Citigroup declined to comment.