PNC, Goldman Sachs, Basis fund $317m financing package for New Jersey development

PNC, Goldman Sachs and Basis Investment Group have come together as part of a $317 million financing package originated on behalf of Triangle Equities and Incline Capital for the development of a transit-oriented, mixed-use project in East Orange, New Jersey.

The funding will be used for the first phase of development for The Crossings at Brick Church Station located on 533 Main Street. Upon its anticipated fourth quarter 2024 completion, the project will feature 200,000 square feet of retail, restaurants and commercial space and 820 mixed-income rental units, as well as varied parking facilities.

The capital stack for the project is layered with a variety of debt and equity sources spread across the retail, site infrastructure and residential components.

The Crossings’ residential financing consists of a series of loans from Pittsburgh, Pennsylvania-based PNC Bank, including a $63.8 million construction loan and a $24.35 million bridge loan. The bank also provided a $14.6 million low-income housing tax credit bridge loan and invested $17.6 million of LIHTC equity.

Finally, the capital stack included a $2 million loan from the city of East Orange and $46 million in direct equity from Goldman Sachs, BIG, Triangle and Incline.

The residential portion of the project is also receiving $20 million in Low Income Tax Credits from the New Jersey Housing and Finance Agency.

PNC, in its capacity as a Fannie Mae DUS lender, also provided a forward commitment for $88.2 million of mortgage-backed securities upon the construction’s completion and lease-up period. Stifel Investment Bank sold an equivalent amount of multifamily taxable mortgage-backed securities secured by US Treasuries until Fannie Mae delivers the mortgage-backed security.

In addition to the residential component of the transaction, the project’s retail and site infrastructure includes a $17 million loan from the Reinvestment Fund in partnership with the Low-Income Investment Fund and BlueHub Capital, $15 million of new markets tax credit equity invested by PNC, $10.5 million from the New Jersey Infrastructure Bank, a $1.65 million Series 2022A Redevelopment Area Bond and $24.6 million of direct equity from the urban investment group within Goldman Sachs Asset Management, BIG, Triangle and Incline. The project is also tapping into a $52 million new markets tax credit allocation led by PNC.

“The Crossings at Brick Church Station is a terrific example of the progress that can be achieved when public and private resources come together to strengthen the economic vitality of our communities,” said Enrico Della Corna, regional president of New Jersey at PNC.

The retail space – of which more than 85 percent is pre-leased – will be anchored by a ShopRite grocery store. The project will be built in two phases, with construction having commenced as of November this year.

Josh Weingarten, director of capital markets at Triangle Equities, added that its vision for the development is to provide a combination of quality retail amenities and mixed-income housing to the region through a “transformative economic and community development project.”