By Joshua Ayers, Senior Editor
New York—Madison Realty Capital (MRC) has announced plans to construct a 170,918-square-foot 80/20 mixed-rate multifamily community in the Clinton Hill neighborhood in partnership with USAA Real Estate Company. The new development, is expected to cost $88.5 million in total investment and will be built on four parcels located on the corner of Waverly and Atlantic Avenues that MRC purchased for $31 million.
“This was a unique opportunity to assemble a large site and develop an institutional quality multifamily development with tremendous growth potential in this popular Brooklyn residential neighborhood,” says Josh Zegen, co-founder and managing principal of MRC. “Limited supply coupled with enormous demand for quality market rate and affordable housing product in this area, and the development’s 421a tax benefit, makes this project an ideal fit for our overall investment strategy, and exemplifies our ability to identify and maximize quality long-term investments with strong upside. MRC and our partner USAA Real Estate Company look forward to its completion.”
MRC initially purchased the 551 Waverly property for $23.5 million and recently closed on the three adjacent properties for $7.5 million. In addition to the parcels, MRC acquired additional development rights from neighboring properties via two off-market transactions, which brought the site’s total developable space to 24,466 square feet.
“This transaction reinforces USAA Real Estate Company’s succinct Build to Core strategy of investing in Class A, urban in-fill, transit oriented multifamily, ground-up developments in high barriers to entry, growth markets across the U.S.,” says Hailey Ghalib, managing director of multifamily development for USAA Real Estate Company.
Plans for the development call for an eight-story mixed-use development that will include 191 residential units and retail storefronts along Atlantic Avenue. Apartments will be available in studio, one- and two-bedroom floor plan options. About 27,515 square feet of space will be below grade and used for an assortment of functions including amenity space, parking—96 spaces— and storage space.
MRC and USAA Real Estate Company wish to utilize a hands-on management strategy and will “engage an experienced and competitive marketing team to lease up the property as it approaches completion,” according to a press release issued on behalf of the companies.