Dive Brief:

• New York City developer CIM Group announced that it had secured a $600 million-plus construction loan for a three-acre, mixed-use high-rise residential project at 85 Jay Street in the Dumbo neighborhood of Brooklyn, New York. J.P. Morgan Chase Bank is providing the loan for the Morris-Adjmi-designed complex, which CIM is developing in partnership with mixed-use, urban developer LIVWRK.
• The project's 730 units will be a mix of for-sale condominiums and rental apartments ranging from studios to four-bedroom floor plans and will include 90,000 square feet of retail, parking and amenities such as rooftop pools. The project is expected to be complete in 2021.
• Jared Kushner, President Donald Trump's son-in-law, was a partner in the project through his firm, Kushner Cos., before selling his 2.5% stake in Jay Street and another project, Panorama Brooklyn, earlier this year, according to the New York Post. The move reportedly came as part of Kushner's attempt to raise cash for other endeavors. The Panorama project, which CIM is also completing in association with LIVWRK, will total 740,000 square feet across two blocks in Brooklyn Heights and will feature office and retail space. 

Dive Insight:

Financing multimillion projects is typically a challenge in New York City and elsewhere, but banks are reportedly loosening the purse strings a little in the face of "aggressive" competition from nontraditional, less risk-averse lenders.

The results of the Federal Reserve Board's April senior loan officer opinion survey indicated an easing of lending standards on the part of U.S. banks that hasn't been seen for at least three years. This new attitude toward commercial real estate loans has affected maximum loan size and spread across all three major loan categories.

Foreign banks have reportedly made similar walk-backs of tight restrictions. Banks, survey participants reported, have become more willing to accept risk in light of stable commercial real estate prices, vacancy rates, fundamentals and capitalization rates.

Loans from nontraditional lenders, like debt funds and life insurance companies, are usually more expensive than financing from traditional banks. However, their ability to work outside the highly regulated banking system permits them to take on high-risk loans and secure higher returns for their investors.

The $25 billion Hudson Yards development has used various forms of financing, including $475 million in debt financing from Starwood Property Trust and a reported $600 million in EB-5 visa funds. The EB-5 program lets foreign nationals invest up to about $1 million in qualified U.S. projects in exchange for expedited processing of their green card applications.