Mack Real Estate Credit Strategies (MRECS) has provided a $55m loan to Madison Equities for the construction of a condo tower to be developed at 45 Broad Street in Downtown Manhattan.
The floating-rate bridge loan has a 12-month term with three one-year extension options and carries a roughly 52 percent loan-to-value, sources told Real Estate Capital. The loan, part of $75m in total financing, allows the developer to complete pre-development work before securing a construction loan.
Madison Equities, in partnership with Italian multi-national construction services company, Impresa Pizzarotti & C. Spa, acquired the land for $86m. Pizzarotti IBC, the US branch of the latter group, is the construction manager and the builder. The developers plan a Cetra Ruddy-designed 290,000 sq ft high-rise condo tower, slated for occupancy in 2019.
Launched in October of last year and headed by former Blackstone debt executive Peter Sotoloff, MRECS has focused on construction loans, transitional and distressed opportunities. Flying mostly under the radar, the platform has originated about $1.1bn in loans in October alone.
Downtown Manhattan has boomed in recent years with the rise of the new World Trade Center site, the revamped Brookfield Place development, an insurgence of creative/tech companies and younger residents, which has given private lenders confidence to invest in the area’s condo development. That said, MRECS was keen to enter the deal with enough cushion to support a potential change of direction from condos to rentals, sources said.
Developer Kent Swig had planned a hotel-condo project at the site prior to the market collapse, after which lender Lehman Brothers Holdings took it over.