Dov Hertz gets construction loan from JPMorgan
Dov Hertz has landed a big loan to build his multi-story warehouse in Sunset Park.
JPMorgan has provided developer DH Property Holdings with nearly $ 442 million in financing for its planned 1.3 million square foot Brooklyn distribution center, people familiar with the transaction told The Real Deal.
The funding will allow DH Property and its partners – Bridge Development Partners and Banner Oak Capital Partners – to start building the four-story warehouse next year. Construction is expected to take between 36 and 40 months.
Representatives for DH Property and JPMorgan declined to comment. TradedNY first reported the loan, which was arranged by Eastdil Secured.
The massive project will cover 18 acres along Third Avenue between 19th and 21st Streets. It is one of a handful of multi-story warehouse developments in the city looking to capitalize on the strong demand from e-commerce and logistics companies for distribution points in the city.
Hertz and its partners bought the site at 75-81 20th Street for $ 255 million in 2019, with $ 200 million in funding from Apollo Commercial Real Estate.
Hertz noted at the time that the location is within an hour’s drive of 13 million consumers.
âIt sits at the crossroads of the inbound and outbound traffic needs of any third-party logistics, parcel carrier or retailer looking to meet same-day or next-day delivery in New York City,â he said.
Pressure from the e-commerce industry for prompt delivery has only increased since then. Space for last mile distribution centers in the city is hard to come by, but developers can maximize it by building themselves. The downside is the higher cost, in part because truck ramps to the upper floors are required.