Coney Island Mixed-Use Project Lands $252M Loan

Cammeby’s International Group and Rybak Development has secured a $252M financing package for one of the largest residential developments in Coney Island, a 499-unit campus at 532 Neptune Avenue.

Valley National Bank and three other lenders provided the financing in a deal arranged by Meridian Capital Group.

The three-building, ground-up project will provide 499 apartments, including 150 units of affordable housing. The development will include 40K SF of commercial space, 20K SF of community space and amenities including a pool, indoor basketball court, yoga studio and a golf simulator.

Trump Village Section Four, a local co-op, filed a lawsuit trying to block the joint venture from building the Neptune Avenue project, claiming it will block the view of the Manhattan skyline.

The foundation for the apartment campus was poured last June before the deadline for 421a tax abatements, meaning the project will be eligible to receive the tax breaks if it is completed before June 2026.

Cammeby’s purchased the Neptune Avenue site as part of a 6,000-unit purchase from the Trump Organization in 2003 for $799M.

This has been an active time for residential transactions on Coney Island. In June, Arker Companies sold for $150M its Sea Park housing portfolio located at 2930 W. 30^th Street, a block away from the beach, including three multifamily buildings encompassing 961K SF and 816 units, to a partnership that is pledging to expand the number of affordable units in the portfolio.

Tredway, Gilbane Development and ELH Management purchased the Sea Park complex, with Berkadia and Deutsche Bank providing financing for the transaction. Ariel Property Advisors represented the seller. The complex, includes Sea Park North, Sea Park West and Sea Park East.

Will Blodgett, Tredway’s CEO, told TheRealDeal that all of the units at the Sea Park complex will be “reserved as affordable for the next 60 years.”

Existing tenants will keep their housing, but new rules will apply for future applications, Blodgett said, with about 600 apartments reserved for households earning up to 60% of the area median income; 150 units will go to households earning 50% percent of AMI; 75 units will be reserved for households earning up to 80% of AMI.

A 145K SF site adjacent to Sea Park North, part of the deal, is slated for the development of 250 new units of affordable senior housing. The parcel is currently a parking lot.

In November, real estate investment trust iStar filed plans to build a 23-story, 282-unit apartment tower next to the Coney Island Amphitheater a block from the beach.

The new multifamily on the boardwalk isn’t iStar’s first venture at Brooklyn’s barrier island beach. iStar build the 5,000-seat amphitheater in 2016 in a partnership with NYC’s Economic Development Corp. and ticketing service LiveNation. iStar also converted the Child’s Building in Coney Island into a 135-unit housing projects.

The new apartment building will rise at 3027 West 21^st Street on a site across the street from the amphitheater, currently occupied by a parking lot.

The REIT’s Coney Island projects were part of a sale-leaseback transaction with the NYEDC in which the city bought the land for $61M and leased it back to iStar.

In 2009, NYC rezoned 19 blocks in Coney Island as an amusement and entertainment district. Housing development in Coney Island has tripled in the decade since Superstorm Sandy decimated the area in 2012.

In November, Thor Equities announced a casino bid in partnership with Saratoga Casino Holdings and the Chicasaw Nation. The partners are proposing a beachfront casino in Coney Island that would feature a roller coaster that loops beneath the boardwalk, an indoor water park with glass walls and “multiple hotels and museums.”