MAG Partners’ Big Chelsea Multifamily Project Secures $151M in Financing
Bank OZK put up $73M in debt financing for the building, which will include a Lidl
By Brian Pascus January 8, 2024 1:20 pm
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A joint venture between MAG Partners and Safanad has secured $151.4 million in financing to capitalize a seven-story, 181-unit mixed-use multifamily building in Manhattan’s Chelsea neighborhood, Commercial Observer has learned.
Bank OZK (OZK) provided $73 million of debt financing, while MetLife Investment Management led the $78 million equity financing raise on behalf of both sponsors.
Two different parts of JLL Capital Markets led the respective financing arrangements. JLL’s debt advisory financing team was led by Managing Director Geoff Goldstein and Senior Directors Jillian Mariutti and Stephen Van Leer. JLL’s equity advisory team was led by Senior Managing Directors Rob Hinckley and Jeffrey Julien, and Director Nicco Lupo.
Hinckley in a statement described the current market as “dislocated” and said his team is “thrilled” to have completed the financing in such a challenging environment.
“The project’s best-in-class sponsors have a proven track record delivering market-leading properties that offer outstanding investment characteristics,” said Hinckley.
MAG Partners, led by founder MaryAnne Gilmartin, earned the right to develop the property with Safanad after winning a request for proposals from the owner of the building’s land, Penn South, an affordable housing cooperative. The project secured a 421a tax abatement prior to the law’s June 2022 expiration. Roughly 30 percent of the building’s 188 units will be reserved for low- to middle-income residents. MAG Partners plans to develop the project as an energy sustainable, LEED Gold-certified building.
The property is at 335 Eighth Avenue, at the corner of Eighth Avenue and West 26th Street in Chelsea. Roughly 90 percent of the units in the mixed-use project will consist of studios and one-bedroom apartments, with remaining units two-bedrooms. The building will carry 30,000 square feet of amenities, including a fitness center, a media lounge, a coworking space, a ground-floor private garden, and a rooftop garden. There’s supposed to be a 25,461-square-feet Lidl Supermarket on the ground floor.
“In a market with a 2.1 percent vacancy rate, 335 Eighth Avenue’s curated unit mix and high-level amenity package will meet demand from renters seeking to live in a desirable luxury multihousing development in the highly sought-after neighborhood of Chelsea,” said Mariutti in a statement.
The project is set to be completed in the third quarter of 2025.
Brian Pascus can be reached at bpascus@commercialobserver.com
