Signature Bank, Keysite Capital Provide $78M Refi for Morningside Heights Portfolio


Novel Property Ventures has secured a $78 million fixed-rate refinance for its six-building Morningside Heights multifamily portfolio, Commercial Observer has learned.

NKF Capital MarketsDustin Stolly, Jordan Roeschlaub, Daniel Fromm and Jason Deck arranged the financing, with Signature Bank as senior lender and Keysite Capital Partners in the mezzanine position. The senior to mezzanine breakdown couldn’t be ascertained by press time.

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The financing replaces $72 million in senior and mezzanine debt that was provided by Square Mile Capital Management in July 2017.

The rental properties—at 111 West 104th Street, 242 West 109th Street, 3143 Broadway, 3147 Broadway, 3149 Broadway, and 500 Cathedral Parkway—were acquired for $80.8 million in 2014 and are currently 100 percent occupied.

Novel Property Ventures, led by Bennat Berger, utilizes a value-add strategy to acquire multifamily assets in supply-constrained markets. The firm recently invested over $10 million in capital improvements to the properties, including unit renovations and building systems upgrades.

“This refinancing allows [Novel] to repay their existing debt provided by Square Mile Capital and provides the capital necessary to successfully complete the execution of their business plan,” Stolly said.

Known as the Academic Acropolis, Morningside Heights is home to a number of educational institutions, including Columbia University, Barnard College and Teachers College. Columbia’s new 17-acre Manhattanville campus—which sits along Broadway north of 125th Street—has spurred a wave of residential construction in the neighborhood.

A few blocks South, Savanna is building its 32-story Vandewater condominium building on a parcel of land at the Jewish Theological Seminary’s Morningside Heights campus at 525 West 122nd Street.

“Average asking rents in the submarket are currently at its 10-year high, which have experienced 13 percent growth since 2010,”  Fromm said in prepared remarks.

The NKF team is having a busy year-end; last month it closed a $250 million five-year refinance for Normandy Real Estate Partners, Meadow Partners and AM Property Holding Corp.’s 80-90 Maiden Lane (with Invesco Real Estate as lender) and in September it sealed a $66 million partial recapitalization of Fortis Property Group’s 1 Seaport luxury condominium tower (with Mack Real Estate Credit Strategies).

Officials at Novel Property Ventures, Signature and Keysite could not immediately be reached for comment.