Eastern Union Funding arranged a $20 million loan for ground up construction on 99 Morningside Avenue on behalf of Azimuth Development Group LLC.
Eastern Union’s Jeff Seidenfeld brokered the loan, which covers 100 percent of construction costs and 90 percent of the client’s out of pocket costs—a loan with a storyline in its own right for what will be a game-changing piece of real estate in West Harlem.
Provided by Madison Realty Capital, the loan features two years interest-only with an interest rate of 11.5 percent.
“Normally, paying double digit rates is very high, and most of our construction loans are sub-five percent,” Seidenfeld said. “In this case, the final product was cheap equity. This leverage would have been impossible had we gone with a conventional bank, the client would have had to put up substantially more equity and possibly taken out a partnership.”
The construction site is the current location of St. Luke Baptist Church. Upon completion, the building will stand eleven stories and house 22 condos with the cellar, ground floor, and a portion of the second occupied by the same church. Demolition of the existing structure at 99 Morningside is scheduled imminently, and construction will commence immediately after.
“We want to bring south of 96th Street quality north of 96th street,” said Azimuth founder Guido Subotovsky. “West Harlem has seen a significant resurgence in the last several years and we see this development as the tipping point of that. We think our project will bring to the neighborhood the kind of quality you’d see in a downtown structure and sets a new bar moving forward.”
Subotovsky found his footing in the market by aggressively turning around affordable housing projects, with an emphasized focus on the Bronx. Now, his firm has diversified and is focusing on emerging markets.
To finalize plans for the glass-façades of the planned structure, Azimuth also purchased an adjacent property and worked with its architect to ultimately win this deal from a pool of roughly 30 bidders. Azimuth expects to complete construction in late 2016.