A unit of private equity giant Apollo Global Management has lent $88 million for what’s billed as New York’s largest privately owned industrial site as the investment giant said recently the sector has more “favorable” risk profiles compared to other property types including multifamily, retail and office.
Apollo Global Management subsidiary Athene has offered the funding to help refinance and revamp 1900 South Ave. in Staten Island, New York, DH Property Holdings, the site's owner and a developer of urban infill industrial logistics facilities, said Friday in a statement.
DH Property said the 53-acre site offers “rare tri-modal access” with a railroad track connection to the CSX/NS National Rail System served by Conrail, a 650-foot waterfront steel bulkhead dock and direct interstate access to Route 440. The site is near Goethals Bridge, Verrazzano-Narrows Bridge and the largest port on the East Coast, The Port of New York and New Jersey, DH Property said.
DH Property bought the site in December 2020 before acquiring additional adjacent parcels in 2021. It said the property has attracted a “diverse tenant roster” with flexible zoning for warehouse, industrial and distribution space. City Asphalt and Insurance Auto Auctions currently lease more than 80% of the site, DH Property said.
Apollo's Athene said in a report in April that industrial is the only sector that checks all three “favorable” risk profile boxes when it comes to demand, occupancy and net operating income growth, compared to hotel, retail, multifamily and office. It also said in today’s commercial real estate environment, it’s better to own debt and not equity.
In another sign of money still flowing for industrial properties when higher interest rates have seized up market activity, Innovo Property Group, with Affinius Capital, closed a $334 million recapitalization of 2505 Bruckner Blvd., a 1 million-square-foot urban industrial facility in the Bronx that CoStar data shows is well more than half leased to Amazon. The property’s existing construction lender, Bank OZK, provided a $250 million senior mortgage, while Pacific Investment Management Company, better known as PIMCO, provided an $84 million mezzanine loan.
For the Record
Walker & Dunlop’s Aaron Appel, Jonathan Schwartz, Keith Kurland, Adam Schwartz and Michael Ianno arranged the DH Property transaction.