A huge last mile distribution center may have hit the last mile of its financial needs.
A joint venture controlled by Turnbridge Equities and Dune Real Estate Partners has secured $ 381 million in new funding from KKR, property records show.
Most of the funds will be used to build the distribution center in Hunts Point, Bronx. It will be approximately 1 million square feet.
The two-story facility is slated for nearly 630,000 square feet of land adjacent to the East River, below 149th Street East, near the Bruckner Freeway. The KKR loans provide $ 224.5 million for construction and $ 94.7 million in new senior debt, and will repay $ 61.8 million in outstanding principal issued by JPMorgan Chase.
Turnbridge, led by Andrew Joblon, has been busy reclaiming industrial properties, including a 129,000 square foot warehouse last year in Queens for $ 39.5 million and a 1 million square foot industrial site in the New Jersey for $ 61 million.
Turnbridge began assembling the Bronx site in 2018, spending a total of $ 174 million to purchase five plots, according to property records. In May, it filed an application to build a 986,000 square foot warehouse at 950 East 149th Street.
KKR and Turnbridge declined to comment on funding for the project, which was arranged by JLL Capital Markets. JLL’s team included Christopher Peck, Peter Rotchford and Madison Warwick. Andrew Scandalios and Tyler Peck arranged the capital partnership.
KKR, a publicly traded company, manages real assets as well as private equity investments. It devotes half of its loan portfolio to multi-family properties, 33% to offices and only 3% to industrial buildings, according to its website.
But the market for last mile delivery centers has been hot for several years and sizzling since the start of the pandemic. Consumer behavior has gradually shifted towards delivery and away from in-person shopping, a trend supercharged by Covid and a race for ever faster delivery.
The driving force behind that, of course, is Amazon, which is looking to open 100 manufacturing facilities in the United States this month and hire 125,000 warehouse workers before the holiday season.
One of the retail giant’s many recent projects is a 64,000-square-foot facility at 49 Wireless Avenue in Hauppauge’s Long Island Innovation Park, which could accommodate 186 delivery vans.