Marcus & Millichap’s IPA Capital Markets Division Arranges $85 Million Financing for New York City Industrial Condominium

Rhea-AI Summary

IPA Capital Markets, a division of Marcus & Millichap (NYSE:MMI), has arranged $85 million in financing for a Class-A industrial space in Queens, New York. The two-story, 164,295-square-foot industrial condominium is part of the newly built Terminal Logistics Center. The Manhattan-based IPA Capital Markets team secured the financing with LoanCore Capital for Triangle Equities and Goldman Sachs Urban Investment Group.

The refinanced property, fully leased to a global airline catering services firm, includes an additional 102,275 square feet of truck courts. Despite challenges in the current lending environment, the IPA team negotiated favorable financing terms, highlighting the appeal of the premier industrial property in its exceptional location.

Positive

• Successfully arranged $85 million in financing for a Class-A industrial property
• Property is fully leased to a strong tenant (global airline catering services firm)
• Secured favorable financing terms despite challenging lending environment
• Strategic location in Queens, New York, appealing to the lending market

Negative

• None.

Insights

Financial Analyst

The $85 million financing for a Class-A industrial space in Queens, New York, arranged by IPA Capital Markets, is a significant transaction that highlights the continued demand for prime industrial assets in strategic locations. This deal is particularly noteworthy given the current challenging lending environment.

Several key points stand out:

• The property's full occupancy by a strong tenant (a global airline catering services firm) underscores the robust demand for high-quality industrial spaces, especially those near major transportation hubs like airports.
• The successful refinancing, despite market headwinds, suggests that well-located, fully-leased industrial properties remain attractive to lenders, even as other commercial real estate sectors face headwinds.
• The involvement of Goldman Sachs Urban Investment Group indicates institutional interest in urban industrial assets, potentially signaling a broader trend in commercial real estate investment strategies.

For Marcus & Millichap (NYSE: MMI), this transaction demonstrates the company's ability to execute complex deals in a challenging market, which could positively impact investor perception. However, it's important to note that while this is a significant deal, it represents just one transaction in the company's broader portfolio of services and may not materially affect the stock price in isolation.

Investors should monitor Marcus & Millichap's overall transaction volume and revenue trends, particularly in the industrial sector, to gauge the company's performance in the current market environment. The firm's ability to continue securing financing for clients in a tight credit market could be a differentiating factor moving forward.

Real Estate Market Analyst

This financing deal for a Class-A industrial condominium in Queens, New York, offers valuable insights into the current state of the industrial real estate market:

• The $85 million financing amount for 164,295 square feet of rentable space (plus additional truck court area) implies a valuation of approximately $517 per square foot, which is substantial for industrial space and reflects the premium nature of the asset.
• The property's location within the Terminal Logistics Center, a multi-use facility combining industrial and self-storage purposes, showcases an innovative approach to urban industrial development, maximizing land use in a dense market like New York City.
• The full occupancy by a global airline catering services firm underscores the strategic importance of the location, likely near JFK International Airport, highlighting the continued demand for last-mile logistics and airport-adjacent industrial facilities.

This transaction suggests that despite broader economic uncertainties, prime industrial assets in major metropolitan areas continue to attract significant investment and financing. The involvement of institutional players like Goldman Sachs Urban Investment Group further validates the sector's attractiveness.

For the broader commercial real estate market, this deal indicates a potential bifurcation between high-quality, well-located industrial assets and other property types that may be struggling in the current environment. Investors should pay attention to this trend, as it may influence capital allocation strategies within real estate investment portfolios.

The successful refinancing also suggests that lenders remain selective but willing to provide favorable terms for top-tier industrial properties, even as they may be pulling back in other sectors. This could lead to increased competition for prime industrial assets, potentially driving up valuations in key markets.

NEW YORK--(BUSINESS WIRE)-- IPA Capital Markets, a division of Marcus & Millichap (NYSE:MMI), specializing in capital markets services for major private and institutional clients, announced the $85 million financing of a two-story, Class-A industrial space located at 130-02 S Conduit Ave in Queens, New York.

The Manhattan based IPA Capital Markets team of Max Herzog, Marko Kazanjian, Max Hulsh and Andrew Cohen secured the financing with LoanCore Capital on behalf of Triangle Equities and Goldman Sachs Urban Investment Group.

“Triangle Equities successfully developed a premier, Class-A industrial property in an exceptional location, which is now fully leased to a strong tenant,” said Herzog. “The end product appealed to the lending market, allowing our IPA team to negotiate favorable financing terms for the sponsor, overcoming the challenges of the current lending environment.”

The refinanced industrial condominium spans the first two floors of Terminal Logistics Center, a newly built five-floor facility designed for both industrial and self-storage purposes. The rentable space totals 164,295 square feet with an additional 102,275 square feet of truck courts. Tenants include a global airline catering services firm.

About IPA Capital Markets

IPA Capital Markets is a division of Marcus & Millichap (NYSE: MMI). IPA Capital Markets provides major private and institutional clients with commercial real estate capital markets financing solutions, including debt, mezzanine financing, preferred and joint venture equity, and sponsor equity. For more information, please visit institutionalpropertyadvisors.com/capital-markets.

About Marcus & Millichap, Inc. (NYSE: MMI)

Marcus & Millichap, Inc. is a leading national brokerage firm specializing in commercial real estate investment sales, financing, research and advisory services. As of December 31, 2023, the Company had 1,783 investment sales and financing professionals in over 80 offices who provide investment brokerage and financing services to sellers and buyers of commercial real estate. The Company also offers market research, consulting and advisory services to our clients. Marcus & Millichap closed 7,546 transactions in 2023, with a sales volume of approximately $43.6 billion. For additional information, please visit www.MarcusMillichap.com.

About Triangle Equities

Triangle Equities (Triangle) is a diversified, full-service real estate company that develops, owns, and operates commercial, residential, and mixed-use properties throughout New York and New Jersey. Triangle focuses on high-barrier projects, including public-private partnerships, public RFP’s, and - as experts in city, state, and federal incentive programs - projects that require various forms of subsidy. Triangle was founded in 1986 and has developed nearly two million square feet of commercial and residential real estate since its inception. Triangle currently has over two million square feet in various stages of development, including over 1,500 units of mixed-income residential. For additional information, please visit https://www.triangleequities.com/.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240725135933/en/

Media Contact:

Gina Relva, VP of Public Relations

gina.relva@marcusmillichap.com

Source: Marcus & Millichap, Inc.

FAQ

What was the value of the financing arranged by IPA Capital Markets for the New York City industrial condominium?

IPA Capital Markets arranged $85 million in financing for the industrial condominium located in Queens, New York.

Who were the key players involved in the $85 million financing deal for the NYC industrial property (MMI)?

The key players were IPA Capital Markets (a division of Marcus & Millichap), LoanCore Capital as the lender, and Triangle Equities and Goldman Sachs Urban Investment Group as the recipients of the financing.

What is the size and location of the industrial property financed through Marcus & Millichap's IPA Capital Markets (MMI)?

The property is a 164,295-square-foot, two-story Class-A industrial space located at 130-02 S Conduit Ave in Queens, New York, with an additional 102,275 square feet of truck courts.

Who is the main tenant of the industrial condominium financed by Marcus & Millichap's IPA Capital Markets (MMI)?

The property is fully leased to a global airline catering services firm, though the specific name of the tenant was not disclosed in the press release.