Hudson funds Manhattan development loan.

Hudson Realty Capital LLC (HRC), a real estate opportunity fund manager with more than $250 million of origination capability, has provided a 12-month, $1.75 million second mortgage bridge loan to a local experienced developer for the development of a mixed-use property in Manhattan. The sponsor will use the financing to complete construction of the property, which is located at 636640 East 11th Street. The development will feature a mixed-use building with 36 residential units, primarily one bedrooms, and 6,257 square feet of community space on the first floor and lower level, suitable for professional and medical use.

"Despite the small size of this investment, the transaction proved attractive for a number of reasons," remarked Spencer Garfield, managing director of HRC. "The sponsor is an experienced real estate investor with a proven track record and possesses a viable business plan," he said. "Additionally, the property is well-situated in a hot area of Manhattan where there is a strong demand for medical office space and smaller residential units."

The property, which is currently under construction in Alphabet City, consists of a seven-story, elevator building and a two-story building. "The property, which consisted of three brownstones and a vacant lot was underutilized and had great potential as a redevelopment site," Garfield noted.

"Many real estate funds focus on larger, more institutional deals, leaving a gap like this, which presents a real opportunity for the sponsors and for an entity like HRC," Garfield added.

HRC will launch a hybrid debt and equity fund, the Hudson Realty Capital Fund III, LP in May. This third fund will have approximately $100 million in origination capability and equity available. The fund's objective is to create and manage a diversified portfolio of loans and real estate, with a long-range goal of generating high, risk-adjusted returns for its investors.