Dive Brief:
Developers of the 67-story Court Square City View Tower in Long Island City, New York, have secured a $502 million construction loan for the building, which will be the tallest residential tower in Queens when completed, reported GlobeSt.com. Total project costs are estimated to be $700 million, according to The Real Deal. Meridian Capital Group of New York City negotiated the deal for the development team of United Construction & Development Group, FSA Capital and Risland U.S. Holdings, LLC and said it was the biggest loan for a private project in the borough as well. A group of banks, including JP Morgan Chase, provided financing for the 802-condominium building, which will also feature retail on the ground floor. Developers started foundation work last year and, prior to that, secured a $100 million loan from the Bank of China. Chris Xu of United Construction bought the property from Citibank in July 2015 for $143 million. Presales should start at the end of the year, with unit prices ranging from $500,000 to $4 million. The first units are expected to be available by 2021. According to reporting by Curbed New York in 2016, the building was to be at least 964 feet tall, but plans now call for the tower to be 778 feet tall.Dive Insight:
CIM Group scored an even bigger loan recently — more than $600 million for a mixed-use high-rise residential tower in Brooklyn, New York. The three-acre site at 85 Jay Street in the borough's Dumbo neighborhood will offer a 730-unit mix of for-sale and rental units and will feature 90,000 square feet of parking, retail and amenities. Like the first condos at City View, the 85 Jay Street tower is projected to wrap up in 2021. CIM is developing the project in conjunction with developer LIVWRK.
Traditional lenders are easing up a bit on tight lending standards in the face of competition from nontraditional lenders, who are willing to assume more risk and are able to operate outside the U.S. banking regulatory system. However, developers are still exploring alternative financing through options like pension funds and EB-5 visa financing.
High profile projects like the $25 billion Hudson Yards development in Manhattan have taken advantage of EB-5 investments, which foreign nationals make in exchange for speedy processing of their green card applications.
The EB-5 program is highly regulated but has come under fire in recent years after abuses were uncovered. The most recent case is that of a Vermont developer who allegedly gave immigration attorneys $25,000 kickbacks for each foreign investor they brought into his Jay Peak Resort project. The state-run Vermont EB-5 Regional Center, which was supposed to provide oversight for local EB-5 projects, has been shut down by the U.S. Citizenship and Immigration Services.