WASHINGTON, DC—Douglas Development Corp. has secured some $94 million of financing for its Uline mixed-use redevelopment -- or 75% of the project's total development costs -- which has been underway for about six month.
One piece of the capital stack belongs to the highly-popular EB-5 government program. The firm secured $18 million in preferred equity via EB5 Capital. The remaining $75.5 million in construction finance came from Natixis Real Estate Capital. To date, Douglas Development has been financing the construction out of its pocket, principal Norman Jemal tells GlobeSt.com.
The project is remaking the historic Uline ice arena, which is located at 1140 3rd St., NE. (In other circles it is known as the venue that hosted the Beatles first concert in the US in 1964.)
There will be 174,000 square feet of loft office space with rooftop decks and 70,000 square feet of retail with frontage on three major streets, anchored by national outdoor retailer REI, which is taking 51,000 square feet. The project is directly across from the NoMa-Gallaudet U Metro station and five blocks north of Union Station.
"We will turn the space over to REI to begin its build out in the third quarter of 2016," Jemal says. Douglas Development has several office leases in the pipeline for the project, he adds.
Douglas Development approached EB5 Capital about the project last spring. It was not the first time it worked with the company -- it used EB-5 money to refinance part of its redevelopment of the historic 1000 F Street building into a mixed-use office and retail space.
For the Uline project, EB5 Capital secured 36 immigrant investors with each contributing $500,000.
The EB-5 financing raise was led by Brian Ostar, director of global operations for EB5 Capital and structured by Dan Shiff, managing director of EB5 Capital and a principal at Phillips Realty Capital, along with Jon Mullen, director of investments at EB5 Capital and a vice president at Phillips. Phillips Realty Capital is EB5 Capital's joint venture partner.
Will Jemal consider using EB-5 financing again? That would be yes.
"We are exploring it for a project right now. This money is extremely efficient."
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
