KKR Lends $95M on New Gowanus Tower at 544 Carroll St.

A new 17-story rental building on Carroll Street in Gowanus just landed a big refinancing, and the lender is one of the biggest names in private equity. KKR has provided a $95 million, 10-year, fixed-rate loan on 544 Carroll Street, according to Commercial Observer, which first reported the deal.

The borrower is a joint venture of Avery Hall Investments, Bridge Investment Group and Declaration Partners. The building was completed late last year, and the new financing retires roughly $71.1 million of prior debt, per JLL, which arranged the transaction. A JLL capital markets debt advisory team made up of Christopher Peck, Peter Rotchford, Michael Shmuely and Nicco Lupo negotiated the loan.

The property holds 133 apartments: 98 at market rate and 35 designed as affordable. It also includes 6,284 square feet of ground-floor retail along Carroll Street. Residents get a rooftop terrace, a coworking space, a fitness center and a children’s playroom. The site sits within a federally designated Opportunity Zone.

Avi Fisher, a founding partner at Avery Hall Investments, framed the deal as a bet on the neighborhood. “This project reflects our long-term commitment to Brooklyn and our confidence in this neighborhood’s continued evolution,” he said in a statement provided to Commercial Observer. He added that the partners are “proud to have delivered a residential project that stands out for its quality in this dynamic and increasingly established market.”

Peck, a senior managing director at JLL, pointed to the building’s lease-up as the reason lenders showed up. “544 Carroll Street’s strong leasing performance and institutional-quality sponsorship positioned the property to attract competitive financing,” he said in a statement. In his telling, the deal “demonstrates continued lender appetite for well-located, newly developed multifamily assets in New York City.”

Those are the sponsor’s and broker’s words, not an independent read of the market, and the source report doesn’t include rent figures, occupancy numbers or loan terms beyond the amount and structure. KKR did not immediately return Commercial Observer’s request for comment.

What the deal does show is that a ground-up rental tower finished barely a year ago has already been taken out of its original debt and locked into a decade of fixed-rate financing from a major institutional lender. For a stretch of Gowanus that has been reshaped by new residential construction, that is a notable vote of confidence from the capital side, at least according to the people who arranged it.