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Brookfield buys South Bronx Development Site

HSBC provided the debt

Renderings of South Bronx development (Credit: Hill West Architects)

Brookfield Property Partners has secured $96.2 million in acquisition financing from HSBC to close on 2401 Third Avenue and 101 Lincoln Avenue in the South Bronx. The new loan replaces a $31.9 million mortgage from UBS in 2015.

Plans: Upon completion, the Mott Haven project will span 1.3 million SF, and consist of 1,300 apartments (30 percent will be affordable). The residential project will spread across seven buildings

Worth Noting: The deal went into contract in April for $165 million as first reported by the NYPost. Sellers are Somerset Partners and the Chetrit Group.

Flashback: The sellers paid $58 million for the waterfront site in 2014 and broke ground on the first phase of the development last year. It will cost over $600 million to build the entire complex. Somerset’s Keith Rubenstein explained that his firm wanted to lock in profits without having to develop the site.

The backdrop: The partnership was unsuccessful in finding $500 million in construction financing. It was time to either sell outright or concede a significant amount of equity in their capital stack.

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