ELIZABETH, NJ—Holliday Fenoglio Fowler arranged $23.8 million in construction financing for a 138,642-square-foot, state-of-the-art freezer warehouse in Elizabeth, NJ, that rolls directly into permanent financing to avoid interest rate risk.
HFF worked on behalf of the developer, a partnership between Elberon Development Group and The Avidan Group, to place the construction/perm loan with The Provident Bank. Due for completion in June 2016, the building will be 100 percent occupied by Seafrigo NA Cold Storage, a global logistics company for the food business that operates on several continents.
"Elberon and Avidan engaged us to find them a construction-perm loan," HFF director Michael Klein tells GlobeSt.com exclusively. "We marketed the deal to life insurance companies as well as local, regional, and national banks, and found them a deal that would allow them to take interest rate risk out of the equation by going ahead and having the opportunity to lock the perm piece as part of the construction loan, taking advantage of the long term lease that Seafrigo is bringing to the table here. They're getting the construction loan and it rolls right into the perm piece."
The build-to-suit facility will feature 60' clear heights, 18 temperature-controlled loading doors and 4,800 square feet (3.5 percent) of office space. Located at 900 Fairmount Avenue in Elizabeth, the new facility is less than five miles from Newark Liberty International Airport and the port of Elizabeth/Newark and approximately one mile from the entrance to exit 13A of the New Jersey Turnpike (I-95).
"It's got tremendous infrastructure assets, given its proximity to the port, the Turnpike and a lot of other mhighways in the metro area," Klein says."Given that the tenant is importing food products to the Port, it's a tremendous location for them, less than a mile from their existing US headquarters, and their business has grown so much in the last few years that the need to create a building exclusively dedicated to freezer was important to them, so that they could continue their business model."
Additionally, an ample and qualified labor pool is available in the city of Elizabeth and surrounding municipalities.
“Refrigerated industrial properties are not new, but I think as people get more and more health conscious and don't want preservatives and other things in their food, the demand continues to grow for this kind of space," Klein says.
Also on the HFF team representing the borrower was senior managing director Jon Mikula.
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Steve Lubetkin
Steve Lubetkin is the New Jersey and Philadelphia editor for GlobeSt.com. He is currently filling in covering Chicago and Midwest markets until a new permanent editor is named. He previously filled in covering Atlanta. Steve’s journalism background includes print and broadcast reporting for NJ news organizations. His audio and video work for GlobeSt.com has been honored by the Garden State Journalists Association, and he has also been recognized for video by the New Jersey Chapter of the Society of Professional Journalists. He has produced audio podcasts on CRE topics for the NAR Commercial Division and the CCIM Institute. Steve has also served (from August 2017 to March 2018) as national broadcast news correspondent for CEOReport.com, a news website focused on practical advice for senior executives in small- and medium-sized companies. Steve also reports on-camera and covers conferences for NJSpotlight.com, a public policy news coverage website focused on New Jersey government and industry; and for clients of StateBroadcastNews.com, a division of The Lubetkin Media Companies LLC. Steve has been the computer columnist for the Jewish Community Voice of Southern New Jersey, since 1996. Steve is co-author, with Toronto-based podcasting pioneer Donna Papacosta, of the book, The Business of Podcasting: How to Take Your Podcasting Passion from the Personal to the Professional. You can email Steve at [email protected].
