June 23, 2021
New York YIMBY

Excavation And Foundations Progressing At 241 West 28th Street In Chelsea, Manhattan

Below-grade work is progressing at 241 West 28th Street, a 22-story, 479-unit residential project in Chelsea. Designed by COOKFOX for MAG Partners, Atalaya, Safanad, and Qualitas, the two-tower development recently acquired $173 million in construction financing arranged by Maverick Commercial Properties. MAG Partners acquired the Midtown, Manhattan property in December 2018 and established a 99-year ground lease with Edison Properties. 241 West 28th Street is located between Seventh and Eighth Avenues and will have 30 percent of residential units reserved for low- and middle-income households. Urban Atelier Group is the general contractor.

Recent photos show numerous heavy machinery onsite and steel rebar protruding along the perimeter of the foundations awaiting work on the first level of the superstructure. We also spotted the first segment of the construction crane tower around the center of the rectangular lot.

241 West 28th Street. Photo by Michael Young

241 West 28th Street. Photo by Michael Young

241 West 28th Street. Photo by Michael Young

241 West 28th Street. Photo by Michael Young

YIMBY also spotted another COOKFOX rendering of 241 West 28th Street. The illustration is looking east above the streets toward the two buildings that are separated by what could likely be a central courtyard, and gives us a much better idea of the final appearance and tight grid of windows. The rendering also highlights the upper setbacks that make way for numerous private landscaped terraces. The inner walls appear to be completely flat with gray panels running down the center, highlighting the core and mechanical extensions of each tower.

241 West 28th Street. Rendering by COOKFOX

The rendering below is from ground level across the street, and highlights the metal canopy topped with shrubbery above the main entrance along West 28th Street. Dark stone panels will line the walls at the ground-floor retail frontage, above which the main fenestration begins with its warm-colored brick masonry surface arranged in varying horizontal and vertical running bond patterns, metal railings, and dark gray spandrels.

241 West 28th Street. Rendering by COOKFOX

Permits filed with the Department of Buildings in September 2019 listed 241 West 28th Street to yield just over 248,000 square feet divided into nearly 214,000 square feet of residential space and about 10,500 square feet of ground-floor retail space. Amenities include residential lounges, a fitness center, a children’s playroom, and an outdoor lounge with a swimming pool and adjoining terrace.

A completion date of July 2023 is stated on the construction board.



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December 8, 2020
The Real Deal

MAG Partners, Safanad form new joint venture

MAG Partners will bring the development experience, and Safanad will bring the capital.

That’s the setup of a new joint venture between the companies, which is targeting $2 to $3 billion worth of deals, the firms told The Real Deal. Eventually, the joint venture will pursue ground-up development, but in the short-term, it is looking at distressed properties and projects, as well as building conversion opportunities.

The companies are already working together on a 479-unit rental building at 241 West 28th Street in Chelsea. The firms, along with partners Atalaya Capital Management and Qualitas, secured a $173 million construction loan for the project in October.

MaryAnne Gilmartin launched MAG Partners, a spin-off from the firm she formed with L&L Holding’s David Levinson and Robert Lapidus, in December 2019. Gilmartin noted that while her priority since leaving Forest City Ratner in 2018 has been new development, the pandemic has shifted her focus. She described the new arrangement —which will acquire sites and pursue deals as a general partner — as “MAG Partners fueled by Safanad.”

Safanad, a private equity firm that launched in 2009, tapped Oxford Properties Group’s Andrew Trickett in 2018 to help grow its New York real estate operations. Trickett called the joint venture with MAG a “convergence of capital and expertise.”



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October 19, 2020
Bisnow

MaryAnne Gilmartin’s Firm Lands $173M Construction Loan For Mixed-Income Chelsea Project

The development firm launched by MaryAnne Gilmartin in 2018 has secured one of the biggest construction loans in Manhattan since the coronavirus pandemic took hold.

MAG Partners scored a $173M construction loan from Madison Realty Capital for its new apartment building in Chelsea, even as Manhattan’s multifamily market continues to take a beating from the pandemic-prompted exodus of renters. 

The proposed 479-unit building at 241 West 28th St. — set to be completed in 2022 — will be 30% affordable housing, MAG Partners said in a release. The project is a joint venture between MAG Partners, Safanad, Atalaya Capital Management and Qualitas. Construction will begin next month. 

“We were pleased to fill a void which would customarily be financed by conventional banks, and provide our flexibility, certainty, and conviction,” Madison Realty Capital co-founder and Managing Partner Josh Zegen said in a statement. “Located within a few blocks of Hudson Yards and other prominent tech tenant expansions on the west side, [the building] will be one of the only new multifamily rental projects built in Manhattan in the next few years.” 

Gilmartin is currently serving as interim CEO of Mack-Cali Real Estate, a post to which she was appointed in July. At the time, she said MAG would be led by the internal team in place. Before founding MAG Partners, Gilmartin was the longtime CEO of Forest City Ratner.

In a statement, she emphasized the planned building’s proximity to the city’s tech hub, saying it will be a draw to renters long-term. 

“This is an incredibly desirable location as major tech companies continue to sign big leases within walking distance, and we expect to see very strong long-term demand for this property when it opens,” Gilmartin said. 

While tech giant Facebook inked a large lease nearby at Vornado’s Farley Building in August, adding to the 1.5M SF it plans to occupy in Hudson Yards, advertising and technology companies made up nearly half of the companies to offer their spaces for subleasing in Q3.

Brokers also say they are seeing some of the most dramatic apartment rent drops and concessions in Midtown while many leave Manhattan for other boroughs or outside the city, as the work-from-home revolution takes hold and many offices still remain empty



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October 19, 2020
Real Estate Daily Beat

MaryAnne Gilmartin lands financing for West Chelsea project

MaryAnne Gilmartin’s MAG Partners + Atalaya + Safanad + Qualitas have secured a $173 million construction loan from Madison Realty Capital for the development of 241 West 28th Street, CO first reported. Upon completion, the West Chelsea project will span 372,000 SF, and contain 479 apartments, plus a ground floor retail component. 

  • Why it matters: Some investors are stepping back from funding projects in New York City. Commercial-loan volume is down more than 50% this year as of early October, and no loans larger than $50 million from the five boroughs have been bundled into commercial mortgage securities in 2020, though there has been a handful of large single-asset, single-borrower deals, WSJ noted. More than $3 billion worth of loans backing commercial property in the city are delinquent, and loans in creditor negotiations total an additional $4 billion.
  • Dig Deeper: The three-year financing reportedly has a loan-to-cost ratio of 65 percent… 70 percent of the units will be market-rate and the rest will be designated affordable. The project benefits from a 35-year tax abatement.
  • Worth Noting: In 2018, L&L MAG signed a 99-year ground lease for the site. Now that the L&L MAG partnership has split, MaryAnne Gilmartin’s MAG Partners will be leading the development. [CO+WSJ+Trepp]


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October 16, 2020
Commercial Observer

MRC Provides $173M Construction Loan for MAG Partners’ West Chelsea Rental Project

A new rental tower is now fully set to rise in West Chelsea. 

Madison Realty Capital (MRC) just closed a $173 million construction loan for the development of 241 West 28th Street, Commercial Observer has learned. A joint venture between MaryAnne Gilmartin’s MAG Partners, Atalaya, Safanad and Australian investor Qualitas is developing the 479-unit project.

MRC provided the developers with a three-year financing at a 65 percent loan-to-cost. Jeff Rosen, a managing director at MAG Partners, led the financing on behalf of the sponsorship. Maverick Capital’s Adi Chugh negotiated the debt.

“This, in some ways, is a bet on New York, but it’s also a recognition of the resilience of the industry in the face of the pandemic,” Gilmartin told CO today.  “This project is one I’m particularly proud of, because it took so very much to get here. And while I’ve been involved in financings and closings that have been far more complex — from a real estate point of view — I can tell you that all of the externalities and the dynamics associated with the last six months have made this closing a real accomplishment. We are really appreciative of all the sponsorship, including Madison.”

In 2018, L&L MAG signed a 99-year ground lease for the West Chelsea site, with plans to build a 372,000-square-foot COOKFOX-designed property that included retail space on the ground floor. Now that the L&L MAG partnership has split, it’s MAG Partners who is leading the project and it marks MAG Partners’ first standalone deal.

When completed, 70 percent of 241 West 28th Street’s units will be market-rate and the rest will be designated affordable. The project also benefits from a 35-year tax abatement. With the construction financing now sealed, development will kick off next month, and the building is expected to be delivered in 2022. 

“We’re very excited to have closed this $173 million loan at a relatively low loan-to-cost with such an esteemed sponsorship group,” Zegen said. “This marquee 479-unit multifamily rental building, located within a few blocks of Hudson Yards and other prominent tech tenant expansions on the West Side, will be one of the only new multifamily rental projects built in Manhattan in the next few years. We were pleased to fill a void which would customarily be financed by conventional banks, and provide our flexibility, certainty and conviction.”

The deal is one of the few significant construction loans to close during COVID, and the sponsorship had to navigate the new debt playing field when selecting a lender. 

“One complexity was that the conventional lenders are just not showing up at the dance, they’re all frozen,” Gilmartin said. “The usual suspects for us weren’t available to commit, and didn’t believe they could go the distance with us because the future is so uncertain. So, there was a smaller group of prospective lenders. I love [MRC] because Josh and his team are in our business; not only are they lenders, but there are builders themselves. They know how to underwrite risk, and they understand value creation associated with development. 

“And that’s a rare thing in a lender,” Gilmartin added. “So, partly, it’s their DNA that brought them in and I think their staying power had a lot to do with how they’re hardwired. They were the perfect lending option for us, given the state of the city, the uncertainty, and for them it was all about the sponsorship, because they —like us — believe that this is a moment in time and that New York is going to come out of this.” 

The project is close to some buzzed-about projects, including Vornado’s redevelopment of the landmarked former post office at 421 Eighth Avenue. In August, Facebook inked a 730,000-square-foot deal for the entire office portion.

“West Chelsea was — pre-pandemic — one of the hottest locations in all of New York, and it’s a very difficult place to afford a multifamily building because land prices are extraordinarily high,” Gilmartin said. “If you were just doing a straight-up purchase of the dirt you’d never pencil out on a 70/30 [project]; it just would never make sense.”

Gilmartin said that Edison, which owns the land, did not want to part with its interest in the site, “so, we have here an opportunity to put online a beautiful, mid-block, 22-story asset, and it’s very difficult to imagine that anybody else is going to be able to do what we’re doing,” she said. “We’re building this project in the heart of the tech community and, even through the pandemic, Facebook, Apple, Google and Amazon have all doubled down on the city. We think this particular location is really the heart of where much of the city’s growth and prosperity will lie.” 

The deal represents Safanad’s first multifamily project in New York City. 

“This was a really unique opportunity for us to work with great partners and to make an investment in New York City residential but — more importantly — New York City in general,” Andrew Trickett, a partner at Safanad, told CO. “We looked at this project and its location, and this opportunity is a really great long-term bet on New York City. We’ve had a lot of headwinds flying around the marketplace today, but we have an enormous amount of faith in MaryAnne and her team’s ability to execute here.” 

The rental tower isn’t Atalaya’s first foray into the Nomad market. In 2018, the investment fund provided $65 million in preferred equity as part of a $315 million construction financing for Flag Luxury Properties’ Ritz-Carlton hotel at 1185 Broadway. 

For MRC’s part, it has been actively lending and investing through COVID-19. According to sources, the firm has raised more than $1 billion in capital since the beginning of the pandemic. 

MRC’s ability to approach deals as a lender but with an owner’s perspective was an ideal fit for the 28th Street project, Chugh said. 

“There’s an old saying that goes, ‘You cannot learn about roads from a road map. You can only learn about a road by traveling it,” he said. “And I think Josh is a perfect amalgamation of a lender who also is empathetic to the equity owner/ operator side of the business. When I am talking to Josh about a transaction, I’m talking to somebody who has a multi-dimensional understanding of the deal. He understands the deal from a finance perspective, and he understands the deal from a development perspective. He understands what is required for a developer to be successful, and then he creates a platform and a deal that gives them the tools to get there.”

As for what’s next for MAG Partners, Gilmartin has her hands full but is excited for the future. In July, she was appointed interim CEO of Mack-Cali, as reported by CO. 

“One of the really big milestones for me and my team on this project is that I have spun off out of my partnership with David Levinson and Robert Lapidus, which was a two-year success,” Gilmartin said. “I’ve spun off into MAG partners, which I own 100 percent, and this project came with me along with my other projects. So what’s really exciting about this building is that it’s a hallmark of MAG Partners, which is a 100 percent woman owned, ground-up development company. With this talented group of people that I took from Forest City, I created L&L MAG and now have spun out into MAG Partners, and 28th Street represents the first project of many.”



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