Wells Fargo provided a new $79.5 million financing package for Essex Crossing on the Lower East Side, bringing the bank’s total funding on the massive development project to more than $200 million, Commercial Observer has learned.
The bank provided Delancey Street Associates with a $26.4 million construction loan—$6 million of which was provided by nonprofit Low Income Investment Fund—and $11.7 million in New Market Tax Credits to finance the commercial portion of Site 6, which will house a 15-story mixed-use building. Wells Fargo also provided a $16.9 million construction loan and $11.5 million in Low-Income Housing Tax credits on the residential portion of the development. Eventually, the bank will invest a total of $25.8 million in LIHTC equity on the property.
Additionally, Goldman Sachs and project’s developer Delancey Street Associates—which is comprised of L+M Development Partners, BFC Partners and Taconic Investment Partners—provided roughly $13 million in equity.
The site, which is located at 175 Delancey Street between Clinton Street, Broome Street and Ridge Street in the Lower East Side, will house 100 apartments for seniors, according to Dattner Architects. The apartments will be marked as affordable. New York-based nonprofit Grand Street Settlement will be operating the senior center.
“Site 6 is a significant part of this project because its providing much needed affordable housing,” said Isaac Henderson, project manager at L+M and the director of the Essex Crossing project. “As the population is aging, the need for affordable senior housing is becoming increasingly more important and we are excited that Site 6 is playing a role in that.”
He added that the property would feature 20,000 square feet of community space; 26,000 square feet of space for a nonprofit user; and 50,000 square feet of medical facility space. Think Coffee is reportedly taking retail space at the base of the building, which is slated for completion in 2017. The 138,000-square-foot structure will be LEED-certified and have two levels of rooftop gardens for tenants.
Wells Fargo has remained an active financing partner on the 1.9-million-square-foot mixed-use development. The San Francisco-based bank had previously originated a $109 million construction loan for work at Site 5, which will contain a 211-unit apartment building with half market-rate and half affordable rentals, as CO reported in July.
Delancey Street Associates was selected by the city in September 2013 to develop Essex Crossing, which will contain 1,000 residential units, half of which will be marketed as affordable housing. The joint venture paid a total of $180 million for the nine sites. The overall project cost is expected to total $1.1 billion and is slated for full completion in 2024.
The recent construction loan from Wells Fargo is the second financing on the project to close in the last few weeks. Goldman Sachs provided a $95 million construction loan on Site 1, which will house 55 condominium units, 11 of which will be priced below market rate.
A representative for Wells Fargo declined to comment.