$42M ship’s coming in
New Navy Yard financing
THE Brooklyn Navy Yard Development Corp. has closed on $42 million in financing to restore one of the iconic, 300-acre site’s historic buildings for manufacturing use — a complex significant step forward following a heretofore unreported setback.
The financing package is for Building 127 on Morris Avenue between Third and Fourth streets, a threestory, 1904 brick structure that for much of its life was used to make boat parts and, most recently, for sugar packing until 2017.
The restored and modernized building will have 95,000 square feet of modern industrial-manufacturing space. Brooklyn Navy Yard Development Corp. President David Ehren
berg told The Post: “The two lower floors will have 30,000 square feet of column-free space each. The top floor is extraordinary, with a vaulted ceiling and huge windows.”
The financing cocktail for vacant Building 127 is a mix of equity and debt from eight different public and private sources.
It includes a $7 million net-equity stake for Goldman, an $18 million Goldman loan, $10 million in equity from Chase, $4 million cash from City Hall, and tax-credit and other forms of equity from five different private organizations making up the balance.
The nonprofit development corporation believes the building will appeal to a wide variety of users, especially in the creative and tech fields.
But what happened to a widely touted deal, announced by Deputy Mayor
Alicia Glen in September 2016, for Dutch business-incubator firm B. Amsterdam to lease the whole building?
“B. Amsterdam’s new Navy Yard hub will become a launching pad for new businesses across the five boroughs,” Glen crowed at the time.
The deal seemed alive as recently as April 2018, when it was described in BNYDC’s board minutes as a 26-year lease starting at $25 per square foot in the first year and escalating 10 percent every five years thereafter.
“Fair question,” Ehrenberg said. “We had negotiations to get the project past the finish line until this past spring. But [B. Amsterdam] couldn’t execute.” The company didn’t respond to our questions about why the deal fell apart.
Ehrenberg continued: “Immediately after it became clear the B. Amsterdam project wasn’t going to happen, we immediately flipped the switch.
“When they couldn’t proceed, we took over [the] project and we became the developer and the borrower on all the loans” — including the $18 million from Goldman Sachs that B. Amsterdam was meant to
borrow.
The restoration is being overseen by S9 Architecture and Engineering and includes a gut renovation, replacement of oversized windows, and restoration of column-free floor plates.
Ehrenberg said, “We’re going through, by far, the largest Yard expansion since the Navy moved out.” Recent and in-progress work also includes Boston Properties’ and Rudin Management’s nearly finished Dock 72 office tower, BNYDC’s renovation of 1million-square-foot-plus Building 77, a food court anchored by Russ & Daughters, an expanded Steiner Studios and Steiner NYC’s Admiral Row project including a Wegmans supermarket. The Navy Yard also plans three major ground-up developments.
The complex’s $2.5 billion master plan is expected to raise the Yard’s current 8,500 jobs to 20,000 by 2020 and up to 30,000 a few years later.
There will be 6.2 million square feet of vertical manufacturing space by 2020 with 5.1 million more to follow.
Demand for the Navy Yard’s existing manufactur- ing space is strong — the current 4.8 million square feet of space is 99 percent leased.
At its World War II peak, the Yard employed 70,000 people — which plummeted to just 3,600 by 2001.
Realty Check loves Midtown Sixth Avenue, a thriving office and retail corridor that’s home to the New York Post. So we were stumped by the appearance of a pop-up “shopping court” with a few dozen stands on an otherwise vacant midblock lot at 1150 Sixth, sandwiched between two large buildings. Isn’t this where developer
Morris Moinian’s Fortuna Realty Group was supposed to build a glamorous hotel designed by Ismael Levya — for which plans were first filed more than four years ago?
Don’t worry, a cheerysounding Moinian said — it’s coming. “We’re very busy developing three other sites right now, including the Hotel Hen- dricks on West 38th Street,” he said. “We’ll be focusing on Sixth Avenue next year.”
The new Kingsley Hotel is to be 426 feet tall with 310 suites, a restaurant and ballroom and a rooftop bar and terrace. Earlier this year, Levya’s Web site revealed a glass skin with diamondlike motifs.
But Moinian said, “As always there will probably be mmodifications” — which might explain why Levya’s studio declined to share the image with us. The shopping court — which Moinian termed a “very profitable venture, especially for the holidays” — has “highend” shops, he said. In fact, the stalls selling goods from places as diverse as Turkey, Nepal and Brazil are far above the street-fair norm.
Meanwhile, Moinian bravely dropped a bombshell. While just about every New Yorker says “Sixth Avenue,” Moinian chuckled, “I personally prefer ‘Avenue of the Americas.’ ”