12A —February 2023 — Financial Digest — M id A tlantic Real Estate Journal
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F inancial D igest
Cortese & Frankel secure loan through TriState Capital Bank D2 Capital Advisors arranges $8.5M refinance for office bldg.
Newmark’s Fromm leads financing team AAC refinances Renaissance Plaza for $7.5M in Atlantic City
requirements in order to not only apply for the bond, but also maintain the bond as well. It is key to understand these requirements when deciding step 1 noted above. The issuance of municipal government bonds is governed by state law, which results in varying processes and require- ments depending on the loca- tion of the property. For the State of New Jersey Most tax-exempt bond fi- nancing for housing is issued by the New Jersey Hous- ing and Mortgage Finance Agency (“NJHMFA”). Projects financed through the sale of tax-exempt bonds must com- ply with Section 142(d) of the Internal Revenue Code and the applicable U.S. Depart- ment of Treasury regulations. These bonds are also subject to a statewide volume cap for the funding of housing projects. Information for the financing of multifamily projects for the State of New Jersey is located on the NJHMFA’s website. For the State of New York Housing investment bonds for New York are done through the New York State Housing Finance Agency (“NYSHFA”), a department of the New York State Homes and Commu- nity Renewal. The NYSHFA “provides tax-exempt bond financing that generates ‘as-of- right’ 4% federal Low-Income Housing Tax Credits for multi- family rental housing projects developed by private for-profit and not-for-profit owners.” NYSHFA is authorized to allocate “as-of-right” credits to projects that also receive benefits from other state agen - cies, but the project would still be subject to monitoring by the NYSHFA. Information on ATLANTIC CITY, NJ — Ashkenazy Acquisition Corporation (AAC) , a pri- vate real estate investment firm, announced a year-end refinancing of $7.5M for Re - naissance Plaza, a 76,000 s/f grocery anchored shopping center located in Atlantic City. AAC received a 7-year fixed-rate loan from Provi- dent Bank as part of the refinancing of an existing loan that was maturing. The financing was brokered by a team led by Daniel Fromm , a senior managing director of the debt & structured finance team at Newmark .
bond financing of multifamily projects in New York is located on the Homes and Community Renewal’s website. For Other States Visit the website of the State Agency that is responsible for issuing the bonds. Common Requirements for Tax-Exempt Bonds • Qualified project • Low-income set aside • Rent restrictions • Subject to the terms of a regulatory agreement • At least 95% of the bond funds must be used for eligible costs • Must pass the 50% test 95% Test Under IRC Section 142, tax-exempt financing requires that 95% or more of the net proceeds be used to provide an exempt facility. In some cases, if the issuer fails to meet these spending requirements, it may remedy that failure by taking certain remedial actions. Only eligible costs are taken into consideration when determin- ing costs expended for the exempt facility. 50% Test Under IRC Section 42(h) (4)(B), “if 50% or more of the aggregate basis of any build- ings and the land on which the buildings are located is financed by tax-exempt bonds, then the credit is based on the entire eligible basis of the qualified low-income build- ings, regardless of the source of funds used to finance the qualifying costs. If less than 50% of the aggregate basis of the building and land are financed with tax-exempt bonds, then only the eligible basis actually financed with the tax-exempt bonds is in- cludable in eligible basis.” Samantha Hoyte, CPA, MBA, CFE, Withum. MAREJ “Despite the challenges brought upon by the pan- demic, this property has done exceptionally well,” said Joe Press , COO at Ashkenazy Acquisition Corporation. “Owning one-of-a-kind, irre- placeable assets will always be in demand.” “This financing is a testa - ment that strong sponsors like AAC continue to tap the debt capital markets even in these volatile times,” Fromm added. Ashkenazy Acquisition Cor- poration is a NY-based pri- vate real estate investment firm. MAREJ
OLLEGEVILLE, PA — D2 Capital Advisors has ar- ranged an $8.5 million refi - nancing for an 81,400 s/f of- fice building at 1000 Campus Dr. in Collegeville. Working on behalf of 1000 Campus Partners LLC (an af- filiate of the D2 Organization), D2 Capital Advisors’ Jack Cortese and David Fran- kel secured the loan through TriState Capital Bank. 1000 Campus Partners LLC acquired the building in June 2017 for $13.26 million, that acquisition financing was also arranged by D2 Capital Advi- sors. The building was fully leased to Iron Mountain on a long-term deal, but ownership was aware of Iron Mountain’s plans to eventually consolidate to their Royersford, PA loca- tion. In November 2020 own- ership came to an agreement with Iron Mountain, who had several years left of their term, on a buyout of its lease at 1000 Campus Dr. The loan proceeds will be used to refinance the acquisi - tion debt and provide funds for C FORT LEE, NJ — Unity Bank has opened a new full service branch in Fort Lee, increasing its service footprint to 20 branches and enhancing its retail presence in Bergen County. The new branch is located at 899 Palisade Ave. at the intersection with Co- lumbia Ave. “We are committed to Ber- gen County and Fort Lee is a natural fit to our footprint,” said Unity Bank President & CEO James A. Hughes. “Bank- ing services at the branch level are increasingly important to our customers, particularly small business owners who still, even in the age of elec- tronic banking, rely on branch- es. Community banks are engines for economic growth and we are focused on bringing that drive to Bergen County.” Unity is bringing a local fla - vor to the 1890 s/f branch. The facility features the abstract landscape oil paintings of Ber- gen County artist Sol Zaretsky of Teaneck. Unity purchased several of Zaretsky’s paintings through its program to support local artists in communities where it has branches. The facility, previously oper- ated by another bank, includes
1000 Campus Dr.
capital expenditures, tenant improvements, leasing com- missions, and carry costs. “This financing provides a lot of flexibility to market the property that most office land - lords do not have right now,” said David Frankel, COO of D2 Capital Advisors. “Executing a new loan on a vacant office building speaks volumes to the business plan, our relation- ships, and the property itself.” The owner plans to re-tenant the now vacant building and has the by-right ability to build another 80,000 square foot property on the 18-acre site.
For additional development, the site has received interest for life sciences, residential, and self-storage development. 1000 Campus Dr. is situated in the 340-acre master planned Providence Corporate Center. It is located at the intersection of Route 422 and Route 29. The immediate area offers a deep talent pool and more af- fordable office rents than the neighboring King of Prussia sub-market. Its proximity to the GSK, Dow, and Pfizer campuses has attracted atten- tion from life science users and developers. MAREJ
Tax-exempt bond financing . . . continued from page 2A
Unity Bank opens Fort Lee, New Jersey branch
Unity Bank
dedicated parking and drive- up banking and ATM services. Surrounding businesses in- clude an insurance company, salon and a dentist. Ryan Peene , Unity Bank’s senior vice president/chief depository officer, who is well known in the Bergen County and Hudson County communi- ties for his leadership roles on the City of Hoboken Planning Board and Greater Bergen Community Action, leads the development of the Fort Lee branch and all of Unity’s retail banking operations. The Fort Lee team also in- cludes Franca Fabrizio , area manager; Sunita Pereira , operations manager; Vince
Forma , commercial lender; Kathleen Hay , SBA lender; and mortgage lenders Nicho- las Aversa and Pasquale Grande . Fort Lee is the second new branch opened by Unity in the last two months. In December, the bank opened a branch in Lakewood in Ocean County. Unity Bank now provides financial services to retail, cor - porate and small business cus- tomers in Bergen, Hunterdon, Middlesex, Ocean, Somerset, Union and Warren Counties in New Jersey and Northampton County in Pennsylvania. The bank holds about $2.4 billion in assets and $1.8 billion in deposits. MAREJ
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