The Bronx, New York – The Domain Companies has purchased 445 Gerard Avenue and 414 Gerard Avenue in the Mott Haven section of the Bronx for $38.5M. The 44,500sf sites allow for the development of an approximately 428,906sf mixed-income, mixed-use residential property consistent with Domain’s focus on community development and sustainable design.
The sites are located within an Opportunity Zone, and currently zoned M1-4/R8a within the MX-13 Special Mixed-Use District. It is expected that both sites will participate in the New York State Brownfield Cleanup Program and include at least 25% affordable housing. Previously dominated by industrial and manufacturing industries, Mott Haven was rezoned in 2009 to allow for more residential and commercial development. In 2015, Mayor Bill de Blasio announced a $194M investment focus in the “Lower Concourse North” area, which included street improvements, new Harlem River open space, and more.
“We’re looking forward to growing within and alongside the Bronx community with these recent acquisitions,” says Matt Schwartz, Co-Chief Executive Officer, The Domain Companies. “Domain takes pride in developing impactful, high-quality projects and shares the city’s dedication for investing in, and engaging with, the community.”
As Domain’s fourth and fifth acquisitions in the NY-area over the last 18 months, the Mott Haven sites expand the company’s efforts to enhance its presence in the market. Domain has worked in several rezoned neighborhoods throughout New York and has developed a successful track record in creating mixed-income housing and remediating brownfield sites. Most recently, Domain purchased 553 Sackett Street, 545 Sackett Street, and 420 Carroll Street in Gowanus, Brooklyn, representing three of the few sizable redevelopment parcels in Gowanus to sell in recent years. Prior to these acquisitions, Domain developed several mixed-income projects throughout New York. These include Eleven33 in Greenpoint, Brooklyn, a LEED Gold-certified, mixed-income development participated in the New York State Brownfield Cleanup Program and received the 2015 Big Apple Brownfield Award for Green Building.
Financing for the Mott Haven acquisition was provided by equity partner Hunt Real Estate Capital, senior lender Centennial Bank, and mezzanine lender Sherwood Equities. The $30M in acquisition financing from Centennial Bank and Sherwood Equities was arranged by Christopher Peck at HFF. Commercial real estate advisory firm Newmark Knight Frank served as the investment sales broker for the deal.
“We are thrilled to launch our Opportunity Zone investment strategy with Domain in the South Bronx. Domain’s history of community engagement, coupled with the potential for inclusive growth in the South Bronx through mixed-income housing, represents what we believe is the intent of the Opportunity Zone program,” says Rachel Diller, Senior Managing Director Equity Strategies, Hunt Real Estate Capital. “The project signifies a continuation of our long-standing relationship with Domain and our history of investing in public-private partnerships in evolving neighborhoods.”
“Sherwood is excited to again partner with The Domain Companies,” says Jonny Snider, Senior Vice President, Sherwood Equities. “We have high confidence in the Domain team and are thrilled to be part of the next chapter of the South Bronx’s storied history.”
“When Domain approached Newmark Knight Frank with regards to seeking out opportunity zones in New York City, Mott Haven seemed a natural location for them to increase their footprint,” says David Behin, Executive Managing Director, Newmark Knight Frank. “The neighborhood is developing rapidly. With its convenient commute to Midtown in Manhattan and access to green space and diverse housing options, it’s easy to see why.”
The Mott Haven sites sit in the middle of the rapidly-developing South Bronx, where separate development projects from market leaders range from residential and affordable housing to green space, transportation, and entertainment.
About The Domain Companies
Founded in 2004, The Domain Companies is based in New Orleans and New York and specializes in the development and management of unique, mixed-use properties in core urban locations. Domain creates high-quality properties that stand apart through innovative design and exceptional management, enhancing the communities in which they build. Domain’s projects include the new construction and preservation of affordable, mixed-income, and luxury housing; the acquisition and repositioning of distressed housing; historic restoration; brownfield redevelopment; seniors and special needs housing; and hospitality, retail, and commercial development. www.thedomaincos.com
HFF and its affiliates operate out of 26 offices and are a leading provider of commercial real estate and capital markets services to the global commercial real estate industry. HFF, together with its affiliates, offers clients a fully integrated capital markets platform, including debt placement, investment advisory, equity placement, funds marketing, M&A and corporate advisory, loan sales and loan servicing. HFF, HFF Real Estate Limited, HFF Securities L.P. and HFF Securities Limited are owned by HFF, Inc. (NYSE: HF). For more information, please visit hfflp.com or follow HFF on Twitter @HFF.
About Newmark Knight Frank
Newmark Knight Frank (“NKF”), operated by Newmark Group, Inc. (“Newmark Group”) (NASDAQ: NMRK), is one of the world’s leading and most trusted commercial real estate advisory firms, offering a complete suite of services and products for both owners and occupiers. Together with London-based partner Knight Frank and independently-owned offices, NKF’s 16,000 professionals operate from approximately 430 offices on six continents. NKF’s investor/owner services and products include investment sales, agency leasing, property management, valuation and advisory, diligence, underwriting, government-sponsored enterprise lending, loan servicing, debt and structured finance and loan sales. Occupier services and products include tenant representation, real estate management technology systems, workplace and occupancy strategy, global corporate services consulting, project management, lease administration and facilities management. www.ngkf.com