$39M Loan Funds NYC Property Acquisitions

NEW YORK CITY-The Patriot Group has provided acquisition funding to two developers of recently acquired local properties. Focusing on small and mid-sized developers, Patriot has been active in closing structured real estate transactions across the US.

The first loan is a $17-million senior mortgage to Real Estate Equities Corp. for the acquisition and repositioning of a 24-unit apartment building located on 14th Street in the city’s Meatpacking District. Patriot provided Real Estate Equities Corp. with the financing to acquire the property, as well as an additional funding commitment to reposition and upgrade the building. In addition to planned improvements for the underutilized street-level space, the building also includes approximately 10,000 sf of air rights. This is Patriot’s second acquisition and repositioning loan to this developer.

The second loan is a $12-million senior mortgage to Peter Moore Associates for the acquisition and redevelopment of a site on 10th Avenue in the rapidly emerging West Chelsea neighborhood. Dan Harrington, managing partner of Patriot’s real estate division, tells GlobeSt.com that the company was attracted to the changing environment here. Patriot recognized that recent zoning changes which allow a change of use from manufacturing to residential, along with the opening of the Hudson River Park, have spurred economic development in this submarket. The developer is pursuing a redevelopment plan that will include a newly constructed residential building while preserving a fully occupied office building.

“Patriot rapidly closed a highly structured loan for us in a short time frame so that urgent time lines set by the sellers could be met,” says Peter Moore, CEO of Peter Moore Associates. “Patriot’s streamlined infrastructure and decisionmaking process enabled it to function as a true partner and respond quickly to our needs, particularly during this challenging credit environment.”

Harrington tells GlobeSt.com that recently, the lending environment has dramatically shifted away from loans originated for securitization and toward balance sheet lenders. “It’s been a good time for us,” he explains. “There has been an increased demand for financing from groups like Patriot.”

Harrington continues that “these transactions contained key positive elements that Patriot has historically focused on for repositioning lending situations, including an improving location, acquisition financing, a seasoned development team, and a thorough and well-defined business plan.”