We’ve invested $2.75 million in the renovation of a six-unit apartment building in Bushwick, Brooklyn. The building, originally constructed in 1931, was last renovated in 2007 and is in moderate condition. With the substantial development that the area has undergone in recent years, we believe that additional renovations to bring the units fully up to date will support a meaningful increase in rental income, and overall property value.
This project is the latest example of our broader strategy to finance the creation or improvement of rental housing in rapidly-growing areas, particularly those where supply is constrained.
Business plan
The sponsor, Charney Construction & Development, intends to perform renovations on all six units with the aim of increasing rental income. Following the completion of renovations and leasing out the improved units, we expect them to either sell or refinance the property to pay back our loan. The anticipated duration of our investment is between two and three years.
Why we invested
- Up-and-coming area: Bushwick has become a popular neighborhood thanks to its relative affordability and access to transit. Since 2015, developers have delivered about 3,700 rental units to Bushwick, which has been accompanied by strong growth in the area’s nightlife and restaurants.
- Steps from transit: The property is just two blocks from the L Train and 5 blocks from the M train, making it a relatively short (less than 45 minute) trip to Manhattan and Penn Station.
- Experienced, local sponsor: Charney Construction & Development has a local focus on developing, owning and operating first-class residential and commercial real estate in the New York metro area. They have successfully completed three apartment renovation projects in New York similar to this project.
