September 6, 2024

The Marino Group Secures $275 Million Loan for Midtown Manhattan Project in Partnership with South Korean Investors

New York, NY – The Marino Group, led by Dom Marino a senior executive at Fortis Investment, has successfully negotiated and secured a $275 million loan from South Korean financial entities for an ambitious new development in the heart of Midtown Manhattan. The loan marks a significant achievement for the group, who have been with Fortis for a decade, further cementing their reputation as leading figures in New York City’s real estate investment space.

The project, which remains unnamed, is set to be a cornerstone development in Midtown, a neighborhood renowned for its iconic skyline, vibrant business environment, and proximity to key transit hubs like Grand Central Station and Penn Station. Fortis Investment’s long-term strategy for this venture emphasizes capitalizing on the highly desirable location and the anticipated favorable shift in economic conditions.

Viability of the Investment

Midtown Manhattan continues to be one of the most sought-after real estate markets globally, boasting a combination of prime office spaces, luxury retail, and high-end residential developments. The newly secured financing from South Korean concerns speaks to the international confidence in both Marino’s leadership and Fortis Investment’s track record.

According to Marino, “Securing this loan is a testament to Fortis Investment’s reputation for sound financial planning and strategic growth. The Midtown project will further enhance our portfolio and contribute to the ongoing transformation of New York City.”

The project is expected to benefit from several key factors that make this investment particularly attractive:

1. Location: Midtown Manhattan is experiencing sustained demand from global businesses, high-net-worth individuals, and commercial tenants. The project’s proximity to major corporations and retail corridors ensures a steady flow of interest and leasing opportunities.
2. Desirability: Manhattan continues to draw interest from international investors and tenants due to its central role in global finance, commerce, and culture. The Midtown area, in particular, is undergoing a resurgence as companies return to office spaces post-pandemic, further enhancing property values.
3. Expected Lowering of Interest Rates: Economic analysts predict that interest rates could decline over the coming years, making it easier for developers to secure more favorable financing terms. A drop in interest rates could improve overall project profitability, allowing Fortis to leverage its capital at a lower cost while maximizing returns.

Projected Returns

Based on preliminary estimates, the Midtown project could see an annual return on investment (ROI) of 12-15% over the next five years, driven by strong leasing demand and capital appreciation. Marino and his team believe that as interest rates stabilize or decrease, the value of Midtown properties will only rise, offering Fortis Investment and its South Korean partners a lucrative exit strategy.

“New York is a resilient market, and we’re poised to take advantage of the coming shifts in both real estate demand and financing conditions. This project exemplifies our commitment to increasing our footprint in the metro area while delivering strong returns for our investors,” Marino added.

Expanding Fortis Investment’s Footprint

Having been with Fortis Investment for 10 years, Dom Marino has played an integral role in its rise as a major player in the New York City real estate market. His ability to navigate complex negotiations, secure international financing, and lead high-profile projects has established him as a vital asset to the company.

Marino’s latest success with the South Korean partnership is expected to drive further expansion opportunities for Fortis Investment, as the firm continues to build its portfolio across Manhattan and beyond. With a focus on sustainable growth and strategic development, Fortis Investment is well-positioned to thrive in an ever-competitive market.

The Midtown project is just the beginning of what promises to be a period of aggressive growth for the firm, with Marino at the helm of its next ventures.

Conclusion

The acquisition of the $75 million loan from South Korean investors represents a major milestone for both Dom Marino and Fortis Investment. With its strong location, strategic timing, and promising returns, the Midtown Manhattan project is set to elevate Fortis’s standing in the competitive New York City real estate market. As interest rates fall and demand for premium real estate continues to rise, Fortis Investment is primed for success.

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98 new dev contracts, 9 boutique dev launches in the borough last month

Sep 5, 2024, 2:00 PM

By  Jake Indursky

The summer has been a confounding one for new development, with the luxury market slumping and Manhattan and Brooklyn showing no clear trends. 

That behavior continued into August in which Brooklyn saw contracts spike year-over-year, the luxury market sputtered and Manhattan held its ground, according to Marketproof’s monthly report. 

The city saw a total of 246 contracts signed last month, up slightly from 236 deals last year. The median price per square foot was down 11 percent to $1,550, and days on market fell 4 percent to 119. 

Marketproof CEO Kael Goodman said that following the mixed signals in August, the next few months should provide a “clear answer” on how buyers are reacting to falling mortgage rates. At the end of August the average 30-year fixed mortgage was 6.35 percent, the lowest it’s been since May 2023. 

And while demand was up slightly, inventory ticked down to 10,532 available units as no new Manhattan projects came online this quarter. Meanwhile, in Brooklyn, nine boutique projects launched, adding 69 units, and in Queens four projects added 87 units.

Jason Thomas, senior vice president of research and analytics at Brown Harris Stevens Development Marketing said development launches in the outer borough have a “quicker launch cycle” than Manhattan projects.

Manhattan saw 123 new development contracts signed in August compared to 116 last year. The median asking price was $2 million and the median price per square foot was $2,084.

520 Fifth has continued to be Manhattan’s standout project, signing nine contracts on one- and two-bedroom units. Rabina’s 99-unit supertall has now sold 61 percent of its units after netting an additional 21 contracts in July and 27 in June. 

Thomas said the building has capitalized on the prestige of a Fifth Avenue address and its reasonable price per square foot. Of the non-penthouse units currently listed on StreetEasy, most don’t crack $3,000 per square foot. Corcoran Sunshine Marketing launched sales for the building in April.

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The luxury market had its third straight month of declining deals, with 24 contracts signed at $4 million or more, two less than last August. 

For a third straight month, 50 West 66th Street led the luxury market, signing four more contracts over $4 million in the 121-unit building. Extell Marketing Group, with the support of The Corcoran Group and Douglass Elliman, is leading sales for the project.

After a meandering start to the summer, the Brooklyn new development market ended with a bang as 98 deals were signed in the borough, a 28 percent increase compared to last year. Deal volume signed in the borough was the highest since May 2023. The median asking price was $1.3 million and the median price per square foot was $1,299.

“I think that Brooklyn is starting to really sort of outpace Manhattan,” Serhant head of research Coury Napier said of the borough’s quickening pace of signings.

Kensington Manor, a new 76-unit project at 428 East 9th Street, led Brooklyn with 10 contracts on studio and one-bedroom units. Goodman said that entry-level units like the ones at Kensington Manor, which are priced between $370,000 and $590,000, have been selling well. Corcoran’s Danielov Team launched sales for developer ZHL Group two months ago. 

While the 24 contracts signed in Queens was one more than last month, it was nearly half as many as the 43 signed in August last year. The median price was $923,000 and the median PPSF was $1,196.

The Vela, a 29-unit project in Astoria, led the borough with four contracts on one- and two-bed units. 

Serhant launched sales in November of last year.

319-321 West 38th Street. Designed by Gene Kaufman Architect

BY: MICHAEL YOUNG AND MATT PRUZNICK 8:00 AM ON AUGUST 3, 2024

Construction has topped out on 319-321 West 38th Street, a 26-story Best Western Hotel in Midtown, Manhattan. Designed by Gene Kaufman Architect and developed by 319 West 38th Steel LP, the 250-foot-tall structure will span 44,200 square feet with an undisclosed number of hotel rooms and a collection of amenities. The property stands on two adjoining interior plots between Eighth and Ninth Avenues.

The entire reinforced concrete superstructure was built since our last update in early February, when crews were still working below street level behind the façades of the two low-rise residential buildings that were incorporated into the podium of the tower. Recent photos show metal frame studs in the process of lining the edges of the floor plates ahead of the start of façade installation, which could begin later this summer.

The below Google Street View image details the look of the low-rise occupants of the property before work began.

The main rendering depicts the new tower rising even with the roof levels of its abutting neighbors. The bulk of the structure will be clad in red brick, matching the look of the original façades at street level, with a four-story section of gray metallic paneling in between. The fenestration is made up of wide industrial-style windows with black mullions. Though absent in the rendering, there is a cantilevering concrete platform just below the parapet that will likely serve as a balcony for an upper amenity space.

319-321 West 38th Street’s anticipated completion date is slated for summer 2025, as noted on site.

25 Cottage Street. Designed by Handel Architects

BY: MAX GILLESPIE 7:30 AM ON JULY 3, 2024

Construction has broken ground on 25 Cottage Street, a 28-story residential building in Journal Square, Jersey City. Designed by Handel Architects and developed by Nasser Freres, the approximately $300 million project is set to deliver 622 rental residences, nearly 45,000 square feet of Class A office space, and ground-floor retail upon its completion in the first quarter of 2026. The property is located between Summit Avenue and John F. Kennedy Boulevard.

Rendering of lounge at 25 Cottage Street, via Cahn PR

Homes will come in studio to three-bedroom floor plans, and amenities will include spa facilities, an art gallery and studio, karaoke room, pet spa, bowling alley, screening room, game lounge, speakeasy, and VR sports room. Beyond that, residents will also have access to a variety of coworking spaces, a fitness center, yoga room, and a podcast room.

25 Cottage Street. Designed by Handel Architects

The property’s rooftop, which was designed by Melillo Bauer Carman Landscape Architecture, will feature a lounge with kitchen and dining areas, private outdoor BBQ areas, an outdoor kitchen, and a pool.

25 Cottage Street is part of the ongoing revitalization efforts in Journal Square. Nearby transit includes PATH service to Manhattan, Jersey City, Hoboken, and Newark, as well as NJ Transit and bus services.

Rendering of lobby at 25 Cottage Street, via Cahn PR

“When you take a look around us, you would be hard pressed to find another three-block area in the entire country that has this amount of activity,” said Mayor Fulop of Jersey City, highlighting the numerous high-rise developments and a 3-acre public park that are under construction, along with the ongoing restoration of the historic Loew’s Theater to its original 1929 glory. “In a short two or three years from now, this will once again be the epicenter of Jersey City, what it likely was 50 years ago. We’re thankful for all of you for believing in Jersey City. We’re excited to be back here for the ribbon cutting in about two years.”

Real estate developer is first U.S. president to be convicted felon 

Donald Trump (Illustration by Kevin Rebong for The Real Deal with Getty)

MAY 30, 2024, 6:11 PM

A Manhattan jury on Thursday convicted former President Donald Trump on all 34 counts of falsifying business records tied to hush money payments paid to porn star Stormy Daniels. 

The verdict makes Trump the first U.S. president, but certainly not the first real estate developer, to be declared a felon.

The charges stem from money given to Trump’s former fixer, Michael Cohen, to reimburse him for a $130,000 payment made to Daniels in exchange for keeping quiet about an affair she says they had in 2006. 

The charges carry up to four years in prison, though Trump is expected to appeal the verdict, the New York Times reported. 

After the verdict was handed down, Trump called it a “disgrace” and told reporters: “This is long from over.”

He also faces three other indictments in three other states. 

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Cohen in 2018 pleaded guilty to eight charges related to the hush money payment, including tax evasion and campaign finance violations, and received a three-year prison sentence. He spent most of his sentence in home confinement.

The conviction does not prevent Trump from running or becoming president, according to the Washington Post. 

Trump’s campaign recently received a boost from CEO Blackstone chair Stephen Schwarzman, who announced his support for Trump in his 2024 presidential bid. Schwarzman previously said he would not back Trump, but cited the rise of antisemitism in the U.S. as a reason for reversing his decision. 

It remains to be seen if Thursday’s verdict will deter others in the industry from publicly joining Schwarzman.

 — Kathryn Brenzel TRD and Staff

A look at options available to developers

APR 25, 2024, 7:30 AM

By 

• Kathryn Brenzel

Now that New York has a new property tax break, developers have options. 

Depending on the state of their site and their eagerness to build, developers can apply for the new program, move forward with the old version of 421a or sell the land, presumably at a better price than was possible a week ago.

Here are some hypothetical scenarios: 

You are a developer with a site in Gowanus. 

After rushing to get foundation footings in place before June 15, 2022, you struggled to get financing, and the chances of meeting the 2026 construction deadline to receive 421a appeared slim.

Then in February, the governor announced a 421a workaround: The state would take ownership of the site and lease it back to you at a price that would mimic the benefits of the tax break. You, lucky duck, got your project chosen for the program, as did 17 others.

But now that the state has extended the 421a construction deadline to 2031, the prospect of going through an entirely different process to receive pretend 421a seems less appetizing. You opt to move forward with 421a instead. Or you decide to sell your site, citing the extended construction deadline in your marketing.

The legislation says only projects “commenced” — meaning initial foundation work was done — after June 15, 2022, are eligible for 485x, so it’s not clear that projects grandfathered under the old 421a can opt for 485x (not that developers would want to).

You own a development site in a part of Long Island City.

You’ve been waiting for a new 421a, in hopes that it will make it easier to unload your site. You didn’t get foundation footings in place before June 15, 2022, so whoever builds multifamily on the site will have to go with 485x.

If the project has more than 100 apartments, construction workers must get wages and benefits worth at least $40 per hour. Higher wage requirements kick in for a project with more than 150 units: at least $72.45 per hour or 65 percent of the prevailing wage. That may make the site a tougher sell.

Let’s say that site is in the Bronx. Or north of 96th Street in Manhattan. Or in a part of Astoria just outside higher-wage “zone B.”

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Congratulations. Your wage requirements are in the $40-an-hour group. Unless you stay under 100 units, in which case the 485x wage floor does not apply.

If you know of other paths folks are taking, please let us know!

What we’re thinking about: I would like to stop thinking about the budget, but here we are. How did the governor decide on the locations of zone A and B, where additional construction wage standards apply under 485x? Send a note to [email protected].

A thing we’ve learned: The roofline of the visitor center at Poe Park in the Bronx, which was built in 2011 and designed by Toshiko Mori, is meant to be reminiscent of raven wings, according to Untapped New York.

Elsewhere in New York…

— Mayor Eric Adams’ $112 billion executive budget restores some $2.3 billion in cuts to schools and city services but leaves cuts that led to Sunday closures of most of the city’s libraries. The mayor blamed library administrators for not coming up with better cost-cutting measures, Gothamist reports. “They did an analysis of what services they’re going to deliver to New Yorkers, and they had the options of finding where they wanted to find those savings,” he said. “All of us had to dig deeper. And some of our libraries have substantial endowments.”

— Over the weekend, City Council Speaker Adrienne Adams phoned the mayor to express her unhappiness with his pick for corporation counsel, Randy Mastro, Politico New York reports. Members of the Council’s Black, Latino and Asian Caucus also released a statement on Tuesday voicing concerns about Mastro, who was an aide to Mayor Rudy Giuliani. The mayor has defended the nomination.

Daily Dirt data

Residential: The priciest residential sale on Wednesday was $12.4 million for a 5,200-square-foot townhouse at 71 West 11th Street in Greenwich Village. Paul Kolbusz, Melissa Sargeantson and Sara Gelbard of the Corcoran Group had the listing. 

Commercial: The largest commercial sale of the day was $186 million for a 520,000-square-foot office building at 1740 Broadway in Times Square. Blackstone sold the property to Yellowstone. 

New to the Market: The highest price for a residential property hitting the market was $28 million for a 3,500-square-foot condominium at 730 Fifth Avenue in Midtown. Eyal Dagan and Chris Poore of Sotheby’s International Realty have the listing. 

Breaking Ground: The largest new building application was filed for a 90,000-square-foot, 11-story building at 1848 Vyse Avenue in Crotona Park East. John Woelfling of Dattner Architects filed the permit.

Gowanus Green. Designed by Marvel Architects

BY: MICHAEL YOUNG AND MATT PRUZNICK 8:00 AM ON APRIL 6, 2024

New renderings have been revealed for Gowanus Green, a six-building mixed-use complex in Gowanus, Brooklyn. Designed by Marvel Architects and developed by The Hudson Companies, Jonathan Rose Companies, The Bluestone Organization, and Fifth Avenue Committee, the four-acre master plan will yield 990,000 square feet across six buildings with 950 affordable homes, retail and community space, an 80,000-square-foot public grade school, and a new waterfront esplanade. SCAPE is the landscape architect for the project, which is bound by 5th Street to the northeast, Smith Street to the northwest, the Gowanus Canal to the southeast, and a vacant plot at 459 Smith Street to the southwest.

The aerial rendering above shows the structures enclosed in red and earth-toned brick façades surrounding orderly grids of large windows. Setbacks across multiple structures and their parapets are shown topped with green roofs, along with several photovoltaic arrays. A new tree-lined street is depicted cutting through the development, running from Smith Street to a central cul-de-sac. The tallest tower in the complex appears to stand 28 stories high.

The following renderings give a closer view of the retail and community spaces at street level, as well as the buildings’ brick façades and fenestrations with dark metal frames and spandrels. Glass railings line some of the rooftops and setbacks, and canopies mark the location of some of the residential entrances. New street lamps and garden beds will also surround the walkways.

Affordable homes at Gowanus Green will cater to a wide range of incomes and needs, including formally homeless, seniors, and low-income New Yorkers. Community spaces are slated to provide early childcare, healthcare, senior programming, and space for artists.

The nearest subways from the development are the F and G trains at the Smith-9th Streets station to the south and the Carroll Street station to the north.

A start and completion date for Gowanus Green has yet to be finalized.

520 Fifth Avenue. Rendering courtesy of Binyan Studios

BY: MICHAEL YOUNG AND MATT PRUZNICK 8:00 AM ON FEBRUARY 1, 2024

New renderings have been revealed for 520 Fifth Avenue, a 1,000-foot residential supertall skyscraper under construction in Midtown, Manhattan. Designed by Kohn Pedersen Fox and developed by Rabina, which took over from Ceruzzi Properties and SMI USA in 2019, the 76-story structure will span 415,000 square feet and yield 98 condominium units and commercial space spread across the ground floor and four cellar levels. WSP is the structural engineer, DeSimone Consulting Engineers is the façade consultant, and Suffolk Construction is the general contractor for the property, which is located at the northwest corner of Fifth Avenue and West 43rd Street, one block north of Bryant Park.

The collection of renderings from Binyan Studios showcases the upper levels and crown, ground floor, and lower setbacks in greater detail than previous depictions. The main photo above previews the top of the skyscraper’s northern elevation, on which the arched window motif stretches to enclose the tower up to its pinnacle. This image also reveals a terrace atop the shallow setback on the narrow eastern face near the top of the structure. At these levels, residents will have dramatic views of the surrounding Midtown skyline and the Empire State Building and World Trade Center to the south.

520 Fifth Avenue. Rendering courtesy of Binyan Studios

The second rendering looks down at the ground-floor entrance, highlighting the details in the arched columns and façade. The building’s address is shown embedded into the sidewalk in interlocking numerals at the foot of the main doors.

520 Fifth Avenue. Rendering courtesy of Binyan Studios

The third and fourth renderings offer a glimpse into the skyscraper’s interiors through its arched floor-to-ceiling windows, as well as a closer perspective of the glass-lined terraces atop the setbacks.

520 Fifth Avenue. Rendering courtesy of Binyan Studios

520 Fifth Avenue. Rendering courtesy of Binyan Studios

“Our design for the 520 Fifth Avenue tower combines the setbacks of Hugh Ferris’ 1920s New York with arches arranged in modular bundles, rising to 1,000 feet,” said James von Klemperer, KPF president and design principal for the project. “The architectural expression of stepping volumes echoes the setbacks of midtown towers, while the delicately articulated exterior wall details are inspired by the façade of The Century Association adjacent to our site. We also looked to the arches of the landmarks in the neighborhood, including the New York Public Library and Grand Central Terminal, translating these forms into a modern version of this motif.”

Construction has continued to ascend since our last update a month ago. Recent photographs show the skyscraper nearing the one-third mark, followed closely behind by the installation of the prewar-inspired façade.

Photo by Michael Young

Photo by Michael Young

Photo by Michael Young

Photo by Michael Young

The nearest subways from the development are the B, D, F, M, and 7 trains at the 42nd Street-Bryant Park/Fifth Avenue station. The property is also in close proximity to the Grand Central-42nd Street station, serviced by the 4, 5, 6, 7, and Shuttle trains, as well as Metro-North and Long Island Rail Road trains at Grand Central Terminal and Grand Central Madison.

520 Fifth Avenue’s completion date is posted on the construction board for June 1, 2026.

BY: MAX GILLESPIE 7:00 AM ON DECEMBER 24, 2023

MetLife has extended its 400,000-square-foot lease through 2038 at its eponymous skyscraper at 200 Park Avenue in Midtown East, Manhattan.

Under the new 11-year lease agreement, which was announced by Irvine Company and Tishman Speyer, MetLife will maintain its substantial footprint in the building, occupying the entire third and sixth floors, along with parts of the mezzanine, fourth, and fifth floors. The company initially consolidated its New York City offices to the 58-story tower in 2017.

200 Park Avenue, co-owned by Irvine Company and Tishman Speyer, has undergone a substantial renovation to rejuvenate its 3.1 million square feet of space. Upgrades include lobby renovations, enhanced connection to Grand Central Terminal, new outdoor gardens and customer lounges, a fitness center, and event spaces.

Currently, the MetLife Building is 96 percent occupied, with over 800,000 square feet of new leases, extensions, and renewals since 2020. Designed by Pietro Belluschi, Walter Gropius, and Emery Roth & Sons in the International style, 200 Park Avenue first opened in 1963 as the Pan Am Building. MetLife acquired it in 1980 and added its logo to the top in 1993. Tishman Speyer and Irvine Company have been the owners since 2005, with MetLife retaining naming and signage rights.

The lease extension was facilitated by Tishman Speyer’s Megan Sheehan and Sam Brodsky, representing the co-owners, while a Cushman & Wakefield team led by Patrick Murphy and Peyton Horn represented MetLife.

“MetLife’s continued presence at 200 Park Avenue is a testament to the connection between the iconic building and one of the world’s leading financial institutions,” said Roger DeWames, division executive vice president, Irvine Company Office. “We are proud to extend our partnership with MetLife as the next chapter of 200 Park begins.”

CIM Group hands back keys to NY building, SF building loses 84% of value due to coworking firm’s travails

OCT 21, 2023, 7:00 AM

By 

• Ted Glanzer

Nowhere is office distress more evident than with WeWork, which, despite its name, isn’t working at all.

Indeed, the coworking firm could be renamed “ReWork” after its staggering losses have forced it to renegotiate nearly all of its leases.

Landlords that count WeWork as a top five tenant owe about $2.6 billion in CMBS debt, an analysis of Trepp data shows. About half of those loans come due within 12 months and nearly 80 percent are either watchlisted, delinquent or in default.

Kushner Companies and Aby Rosen’s RFR are already weathering the fallout of a WeWork departure. The landlords failed to refinance their Dumbo office complex and landed in maturity default last month. WeWork had ditched a majority leasehold in one of the portfolio’s four buildings.

CIM Group, caught in a perfect storm of remote work, rising interest rates and WeWork exposure, is handing the keys to 1440 Broadway back to its lender.

The Los Angeles–based landlord, which picked up the large office property with Australian pension fund QSuper in 2017, saw the $399 million loan backed by the Midtown building go to special servicing this month, according to Trepp.

“The special servicer comments are not encouraging,” a Trepp email alert reads, noting that WeWork, which had been the building’s top lessee, has vanished from the tenant list. A WeWork spokesperson said the firm is still a tenant at 1440 Broadway and a change in building ownership would not affect that.

The CMBS loan had gone to a special servicer because “there is no single lender to negotiate with and the loan must first be transferred to special servicing in order to enter into any negotiations,” CIM said in a statement.