NEW YORK CITY — Innovo Property Group, a New York City-based real estate investment management firm, has completed a $438 million recapitalization of 24-02 49th Ave. in Long Island City, Queens. The firm recapitalized the asset through an equity joint venture with Nan Fung Group and debt from Axonic Capital and Athene Annuity & Life Assurance Company, a retirement services firm under Apollo Global Management.

Before the recapitalization, IPG owned the approximately 830,000-square-foot, seven-story warehouse with Westbrook Partners when they acquired it in July 2016 for $195 million. In December 2017, IPG and Westbrook signed the New York City Housing Authority in a 30-year lease for approximately 600,000 square feet and created a commercial condominium for NYCHA to occupy 100% of its condo unit, which marked the launch of a capital improvement program to upgrade the warehouse into a Class-A office space.

"We are proud of the value we were able to create with Westbrook, who has been a great partner. We are excited to recommit to the asset for its next phase of growth," said Andrew Chung, founder, and CEO of IPG, in a prepared statement. "This transaction represents our belief in Long Island City's future."

Formerly a Bloomingdales' warehouse, the property features up to 24' ceilings, over 100,000-square-foot floor plates, and an approximately 20,000-square-foot parking lot, unobstructed city views and the potential for private indoor and outdoor amenity spaces.

With the renovation project nearly complete, IPG is in the market to lease the remaining 230,000 square feet that includes the building's top two floors and ground floor retail. The available space is its commercial condominium unit, featuring a private ground floor lobby and amenity space, dedicated loading docks, parking, exclusive freight and passenger elevators, as well as roof access. The upgraded space can support biotech, life sciences, medical research and education as well as a traditional office.

"This is a unique opportunity for tenants seeking a headquarters and/or campus feel right outside of Manhattan," said Paul Amrich of CBRE, who will market the property, in a prepared statement. "It is extremely rare to find floor plates this large and so well located to transportation."

IPG has been bullish on the New York City industrial market over the past few years, specifically on last-mile warehouse facilities to meet the growing demand from e-commerce companies. This is IPG's second investment in Long Island City this year, following the acquisition of the former Fresh Direct warehouse for $75 million in January, which is located at 23-30 Borden Avenue, directly across the Long Island Expressway and a short walk from IPG's latest investment.

Long Island City is one of the fastest-growing neighborhoods in New York City with private-sector job growth of 28% since 2009. The property benefits from the long term lease with NYCHA, but can take advantage of the business growth activity from every sector to lease up the remaining space on the top two floors, said Cushman & Wakefield's Adam Spies, who brokered the deal between IPG and Westbrook, in a prepared statement.

Nearby transportation includes the Hunters Point 7-train subway and Long Island Rail Road train stations, adjacent to the Long Island Expressway, and right outside of the Queens-Midtown Manhattan Tunnel.

Instant Insights /

Innovo Property Group Completes $438M Recapitalization for LIC Warehouse

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