Dov Hertz and his partners unloaded a Sunset Park industrial site to FedEx two years after landing a big construction loan for an ambitious project.
Hertz’s DH Property Holdings, Bridge Industrial and Banner Oak Capital Partners are selling the project unfinished: They had borrowed $442 million in 2021 for the project, but records show the sale to FedEx was for only $248 million. Crain’s reported the deal Friday afternoon.
Hertz had planned a 1.3 million-square-foot Brooklyn distribution hub at the 18-acre property, which runs along Third Avenue between 19th and 21st streets. At the time of the November 2021 loan from JPMorgan, construction was supposed to take 36 to 40 months, which would have meant completion late this year or early next year.
It is unclear if Hertz, Bridge and Banner will complete the project for FedEx. Changing developers midstream can be disruptive.
Hertz, Bridge and Banner Oak formed an LLC called SIP Holdings to purchase the site at 75-81 20th Street for $255 million in 2019, with $200 million in financing from Apollo Commercial Real Estate. The deeds of sale to Memphis-based Federal Express list the primary address as 75 20th Street and 50 21st Street and show five parcels totaling 16.4 acres changing hands.
The developers were looking to capitalize on fervid demand from e-commerce and logistics companies for distribution points within the city. Hertz noted the prime location of the property: within a one-hour drive of 13 million customers.
“It sits at the nexus of the inbound and outbound traffic needs of any third-party logistics, parcel carrier, or retailer looking to meet same- or next-day delivery in New York City,” he said at the time.
A call to Bridge Development was not immediately returned.
