Lendlease, Aware Super secure $360m construction financing

The Brooklyn multifamily development market received a shot in the arm this week, with a four-bank syndicate supplying $360 million of construction financing to a joint venture headquartered in New South Wales, Australia.

Lendlease, a Barangaroo, Australia-based real estate investment manager, and Aware Super, a Sydney-based superannuation fund, will use the loan package to develop 1 Java Street along the Greenpoint waterfront in Brooklyn, New York.

Lendlease declined to disclose the specific banks involved in the four-piece lender group, but noted the group consisted of new and existing relationship lenders.

Ben Byrne, portfolio manager at Lendlease, said the financing is proof that creditworthy sponsors can secure debt financing even in uncertain market conditions. Notably, multifamily creation in New York was slightly stymied in recent months with the expiration of the 421a tax credit incentive that helped fuel the development of affordable units in tandem with market-rate apartments.

The 1 Java Street Project will use Lendlease’s investment management, development and construction business units as part of the project, which is expected to be completed in 2026.

“The ability of this project to attract debt financing in the current market verifies our shared belief in the strong fundamentals and future potential of 1 Java Street, a project we believe will not only reshape the Brooklyn waterfront but generate strong cash-on-cash returns for our property portfolio,” said Alek Misev, senior portfolio manager at Aware Super.

An estimated 30 percent of the apartments at 1 Java Street will be designated as affordable housing under the Affordable New York Housing Program. Paired with the dwelling units there will also be 13,000 square feet of retail space and an 18,000-square-foot waterfront park connected to Brooklyn’s India Street Pier.

The project also features sustainability initiatives to meet or exceed New York’s decarbonization legislation, Local Law 97, and is aiming for LEED Gold among other certifications. The Greenpoint development is the sixth installment in Lendlease and Aware Super’s joint venture Americas multifamily portfolio.