Jacob Kohn has completed another piece of the puzzle for his massive multifamily development in Downtown Brooklyn.
Kohn’s Jay Group landed a $53 million construction loan for a 99-unit building at 165 Willoughby Street, PincusCo first reported. Ponce Bank provided the financing, marking another major step forward for the five-building project. The developer landed a construction loan in April for two of the other buildings.
Last year, Jay Group began buying up nearby properties in anticipation of this new development. It shelled out $62.5 million last year for a series of sites from Pearl Realty. The sites included 102 Fleet Place, 165 Willoughby Street and 275 Flatbush Avenue Extension. The developer also spent an additional $12.5 million on air rights from 147 Pearl Street.
Jay Group, led by Jacob Kohn, filed plans last year for 450 units spread among the five buildings, likely due to the terms of New York state’s 485x tax break.
A $40 wage floor kicks in for developments with 100 or more units, prompting many developers to scale back the number of apartments to 99. The buildings will include rentals and commercial space, according to the plans filed by FA Architects & Engineers.
The land is situated within the Special Downtown Brooklyn District, where developers could capitalize on tax incentives for large mixed-use projects with affordable housing components.
After 485x passed last spring, many industry insiders joked that decades from now, people will look back and wonder why the city erected so many 99-unit buildings.
As predicted, multifamily project filings in New York City last quarter spiked for buildings with 50 to 99 units, according to a Real Estate Board of New York quarterly report.
The number of planned units (2,606) in such buildings was more than twice as high as the norm since 2008.
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