KPG to Start Bespoke Office Renovation at 40 Crosby
NEW YORK, June 16, 2023 /PRNewswire/ — KPG Funds (“KPG”) has today announced that it closed on a $50 million construction loan for 40 Crosby, a 70,000-square-foot 5-story SoHo office building owned by KPG Funds to be repositioned as a boutique luxury office building – “The Crosby” – atop prime retail space with Broadway frontage. Sabal Investment Holdings (“SIH”), the real estate investment management firm serving institutional investors, and GDS Brightstar, the real estate lending platform of New York-based GDSNY, are the lenders for the project.
“By never wavering in our belief in the resilience of the greatest city in the world, we are being rewarded with the ability to construct bespoke office space in a gorgeous cast iron building in a premiere location,” said Rod Kritsberg, KPG’s co-founder and chief investment officer. “KPG’s white glove management, exceptional amenities and top co-tenancy will further enhance the cache of 40 Crosby.”
According to Kritsberg, the three-year construction loan will be used to give 40 Crosby a full building renovation, keeping in line with KPG Funds’ ultra-high-end standard to transform it to one of the “most desirable office and retail assets in the neighborhood.”
In addition, the business plan calls for creating a dedicated entrance on Crosby Street, providing a much-coveted address for office tenants that will commence a high-end, expansive multi-million re-purposing of the Crosby Street property. Improvements will consist of a separate entrance on Crosby Street with high-end pre-built office space and significant capital allocated to the lease up of the premiere specialty retail on Broadway.
The property will also feature high end infrastructure, wellness and technology offerings including KPG’s smart app allowing tenants to operate the entire building at the touch of button. 40 Crosby boasts flexible floorplates which will be able to cater to multiple tenants, or contiguous floors for a flagship headquarters location; providing ultimate leasing flexibility.
“We continue to identify high-quality assets and real estate opportunities in New York for our partners and investors,” said Alan Rudikoff, partner and co-founder of real estate firm GDSNY. “40 Crosby is an iconic SoHo cast iron building in a triple-A location and we are proud to be a part of its continued success.”
“Bespoke office is on fire and we can’t build fast enough to accommodate the demand for our Signature KPG office product,” said KPG co-founder and CEO Greg Kraut. “The demand for office space post-covid is being redefined in 2023 by landlords who provide an ultra-high-end experience for their tenants in highly desirable locations.”
The 11,400-square-foot office floorplates are enhanced by exquisite KPG signature design featuring up to 18′ ceiling heights, 20 oversized windows bringing in natural light, a beautiful cast-iron façade, and new management and security systems, all working to create a best-in-class product.
“We are believers in the continued recovery of Manhattan’s office and retail market and are pleased to be able to provide a flexible, innovative financing solution in conjunction with GDSNY for this high-quality project in the city,” said Tal Seder managing director of opportunistic investments at Sabal Investment Holdings. “We continue to be active participants across the capital stack, especially during periods of credit dislocation, and will continue to seek opportunities to work with best-in-class firms like KPG who are looking to reposition well located assets.”
Offered on the lower-level and ground floor, the 18,000-square-foot retail space will be an open-space design catering to a prospective big-box tenant seeking prime location in the bustling Soho neighborhood. The efficient floorplan will allow ease of operations and be structured for open accessibility. According to Kraut, discussions have already commenced with prospective tenants including prominent names in grocery and experiential uses.
The refinancing was arranged for KPG by debt brokers Nick Scribani, Dustin Stolly and Jordy Roeschlaub at Newmark.
SOURCE KPG Funds