L&L MAG Tapped to Develop LIC Waterfront Site

MaryAnne Gilmartin’s one-year-old development firm is coming to Long Island City, Queens.

A group of investors who own a long-vacant waterfront parcel next to the now-defunct Amazon site in Long Island City have hired the Forest City alum’s new company, L&L MAG, to develop their property, Commercial Observer has learned.

While details of the development haven’t been finalized yet, Gilmartin told CO that she hopes to build a large, mixed-use project on the wedge-shaped plot at 44-02 Vernon Boulevard. Bruce Teitelbaum, a onetime chief of staff to former Mayor Rudy Giuliani, has a stake in the property and is the managing partner of the entity that owns it, Vernon Holding Realty LLC, sources familiar with the deal said. Gilmartin declined to discuss the structure of her deal with Teitelbaum, except to say that she was the development partner in the project.

Teitelbaum has been pitching a plan to develop a residential project of at least a million square feet on the site since 2015, Politico New York reported at the time. The vision for the old version of the project included a pedestrian bridge to Roosevelt Island, but neither Gilmartin nor Teitelbaum would discuss what they were planning now.

“MaryAnne is a proven winner who has tackled some of the most complex projects in the city with excellence, creativity and integrity,” Teitelbaum said in a statement. “She knows how to take a project from conception to completion, and now with her newly founded company, L&L MAG, she is perfectly positioned to develop this vital site on the LIC waterfront.”

The property has been in foreclosure since 2012, as the New York Daily News reported at the time. Durst Fetner Residential, an affiliate of The Durst Organization, owns a $32 million note on the property, and the owners are negotiating with Durst to settle the foreclosure case, Gilmartin said. A Durst spokesman didn’t immediately return a request for comment. The site was formerly home to an oil refinery, but all the contaminated material has been removed.  

SHoP Architects, which was involved in the original development proposal, will oversee the design of the new complex built by L&L MAG. The current zoning allows a million square feet of residential development and 60,000 square feet of commercial space, but it’s not clear whether the owners of the 212,670-square-foot property intend to apply for a rezoning.

Gregg Pasquarelli, one of the firm’s principals, said he was “thrilled to be working on the project and with MaryAnne Gilmartin again. We are both committed to making dynamic urban projects centered around beautiful open public space.”

Gilmartin said that she would discuss her plan with the community and with local politicians.

“It’s the very early part of a process that is going to involve a lot of thinking and collaboration with the stakeholders locally and in the community,” she said. “One wants to be deliberate and thoughtful. There’s an as-of-right development opportunity here that’s pretty straightforward, but we’re so early in the process. We’re going to work with the ownership team, the architects and the consultants that have already been put in place.”

This is the second development deal for L&L MAG, which inked a 99-year ground lease for 241 West 28th Street in Chelsea with plans to build a 460-unit residential building, The Real Deal reported last December.

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L&L MAG’s First Project Will Be An Apartment Building In Chelsea

MaryAnne Gilmartin kicked off 2018 by leaving Forest City to found her own firm, backed by the owners of L&L Holding Co. To close it out, the company has announced its first project, a large apartment building in Chelsea, which it plans to start constructing next year.

The project will be a 460-unit rental building at 241 West 28th St. in Chelsea, L&L MAG announced Monday. The building will be developed under the Affordable New York program, with 30% of the apartments set aside for low- and middle-income renters. COOKFOX will design the building.

“We founded L&L MAG to pursue projects that provide value to the community we are building in, to enhance the fabric of our city architecturally and to deliver value to our partners, and I am thrilled that our first development delivers on all of those principles,” L&L MAG CEO MaryAnne Gilmartin said in a statement.

The site of the new building, a block-through parking lot, is owned by Edison Properties. L&L MAG has signed a 99-year ground lease with Edison and will build a public parking garage with the building as part of the arrangement.

Atalaya Capital Management and Qualitas, an Australian asset manager, are partnering with L&L MAG on the project. It is Qualitas’ first investment in the U.S.

“We brought together the perfect team for this project — Atalaya and Qualitas — and have shown we can advance the most complex deals in a very short period of time. We are going to pursue a diverse set of projects across sectors and expect this will be the first of many,” Gilmartin said.

Qualitas will use the deal to launch future investment in the U.S., establishing a New York office, co-founder Mark Fischer said. The firm sought gateway city investments in multifamily, and found it needed to partner with a local like Gilmartin to accomplish that goal.

An Edison executive told The Real Deal that L&L MAG’s offer on the site was not the highest the New Jersey-based team received, but they were convinced by the team Gilmartin had assembled and her reputation.

“You can get away with a lot in this town,” Gilmartin said at Bisnow’s New York State of the Market event last month. “You can build forgettable buildings that deliver tremendous returns, and you can make a shit ton of money. I don’t want to do that.”

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L&L MAG’s first development will be a 460-unit resi building in Chelsea

MaryAnne Gilmartin’s L&L MAG has inked a 99-year ground lease for Edison Properties’ 241 West 28th Street for about $7 million per year with gradual increases, according to sources familiar with the deal. This puts the total value of the deal in the range of $150 to $170 million, depending on the cap rate.

L&L is planning to build a 22-story, 460-unit residential project on the lot that will span roughly 372,000 square feet, Gilmartin said. The building will be split between 70 percent market-rate units and 30 percent affordable units and be developed through the Affordable New York program. It will include retail space on the ground floor and parking on the lower level, and COOKFOX will design it.

Gilmartin expects to have the building designed within a year and have the site ready for construction by the end of next year. Aaron Weaver of Level Investments brokered the deal for the developer.

This marks the first major deal for L&L MAG, which Gilmartin launched earlier this year with L&L partners David Levinson and Robert Lapidus after spending 23 years at Forest City. She has brought on Atalaya Capital Management and the Australian firm Qualitas as investment partners.

“For me, it became an opportunity to convince Edison that we were the best team, that we would produce a building of beauty and value,” Gilmartin said.

Young Kwon, managing director of Atalaya, said his company was interested in this project because of the location, the business partners and the chance to develop a multifamily building, noting that the deal “checked all our boxes.”

A Cushman & Wakefield team of Steve Kohn, Alex Hernandez and Alex Lapidus represented L&L MAG in bringing Atalaya and Qualitas on board.

Edison Properties had previously filed plans in 2014 to develop a 15-story residential building with 323 units on the site. The firm had purchased four properties on West 28th Street to create a 30,000-square-foot lot between 28th and 29th streets and Seventh and Eighth avenues.

Robert Scharf, executive vice president of real estate at Edison Properties, said in a statement that while L&L MAG wasn’t the highest bidder, the company’s project was still the best fit for the site.

“Although we received several higher offers, we chose to ground lease the property to L&L MAG because of the wonderful team that they have put together,” he said. “They have extensive experience developing some of the most outstanding and transformative projects in NYC.”

Edison Properties is based in New Jersey and is betting big on Newark with its Ironside project near the city’s Penn Station. The mixed-use building will have 290,000 square feet of workspaces and grabbed its first big tenant in the spring: Mars Wrigley Confectionery, which will relocate its headquarters from Chicago and take 150,000 square feet in the property.

L&L Holding made its own massive purchase in Chelsea recently with Normandy Real Estate, paying about $900 million for the neighborhood’s Terminal Stores warehouse in October. They are planning to turn the building into a property worth $1.8 billion, and are reportedly in talks to bring Allianz Real Estate of America into their partnership.

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New York Power Women 2018: MaryAnne Gilmartin, Founder & CEO, L&L MAG

Bisnow: What keeps you in commercial real estate and what makes you want to come to work each day?

MaryAnne Gilmartin: First, I am a hopeless developer and it’s all I know! I have deep passion, curiosity and passion for the urban fabric, the built environment and communities — making it easy to come to work every day.

Bisnow: Have you had mentors over your career? Who are they and what influence did they have?

Mentoring has played an outsized role in my professional evolution. The role of mentor or mentee is critical to the career development of the women in our field. My two most influential mentors have been Bruce Ratner and Mary Ann Tighe. With both of them in my corner, I hit the career lottery. Because of the profound impact mentoring has had on my career, I have vowed to always be a mentor to others. It’s a pay forward.

Bisnow: What’s the one thing you would change about the industry and why?

The real estate industry needs greater disruption in the innovation economy. This disruption needs to take place on both the talent and technology fronts. Demanding the best of the best (man or woman); demanding our industry be more inclusive, democratic and merit-based to ensure we look like the communities within which we invest, transit and build (easy peasy, right).

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