Santander, Related Lend $135M on Crown Heights Multifamily Project

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The Hudson Companies has sealed $135 million of construction financing to build a multifamily development in Crown Heights, Brooklyn, the developer announced Monday.  

Santander Bank and Related Fund Management provided the loan on the planned nine-story project that will have 328 apartments and retail space at 975 Nostrand Avenue

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“This investment opportunity is illustrative of our Real Estate Debt Fund’s focus to provide financing to experienced and well-capitalized borrowers for the development of high quality residential assets in New York City and other major markets,” Chad Goodman, managing director at Related Fund Management, said in a statement.

Hudson Companies acquired the site, which previously housed an Associated Supermarket, three years ago from Midwood Investment & Development for $41.5 million, as Commercial Observer previously reported. The project received a tax exemption from New York State’s now-expired 421a program, since 99 of the residential units will be designated as affordable housing. 

The deal was first reported by Crain’s New York Business.

Cushman & Wakefield’s Gideon Gil, Zachary Kraft and Sebastian Sanchez arranged the transaction.

“With 99 units designated as affordable, this property will help fulfill a critical need for affordable housing in a submarket that has experienced sustained demand and a dearth of supply,” Gil said in a statement.

Resident amenities at 975 Nostrand will include a roof terrace, fitness center, yoga room, karaoke room and pet spa. As part of the Hudson Companies’ acquisition, it struck a deal to keep the Associated grocery store in a roughly 21,000-square-foot retail space for another 15 years. The project also has 4,200 square feet of additional retail along with 193 below-grade parking spots.

Construction of 975 Nostrand is expected to finish in the fourth quarter of 2025. 

Marlee Busching-Truscott, managing director of development at Hudson Companies, said in a statement the project, in addition to creating 328 new apartments, will also deliver “a modern space for a beloved neighborhood supermarket, a community facility, and retail space right in the heart of Crown Heights.”

Officials at Santander did not immediately return a request for comment.

Andrew Coen can be reached at acoen@commercialobserver.com.