Deal Marks Companies' Second JV Partnership in New York City
NEW YORK. - Sunday, September 21st 2014 [ME NewsWire]
(BUSINESS WIRE) A joint venture between Prodigy Network and Korman Communities has closed on AKA United Nations, located at 234 East 46th Street between 2nd and 3rd Avenues. The property was purchased for $68.5 million, with more than $10 million raised in crowdfunded equity, senior financing from Bank of America, and subordinate financing from Emmes & Co. Domestic and international accredited investors purchased participations starting at $50,000.
The existing 95-unit, 20-story property will undergo renovations to further enhance its luxury offerings and amenities and will include a furnished courtyard, lobby lounge, state-of-the-art health and fitness center, conference area with business services, private terraces and a 24-hour doorman. A luxury rooftop lounge featuring views of the Manhattan cityscape and East River will be added, with renovations expected to be complete in Spring 2015.
This is the second joint venture between Prodigy Network and Korman Communities and marks Prodigy Network’s third crowdfunded project in New York City.
“Following the success of AKA Wall Street, our existing crowd of investors was quick to recognize the value associated with Korman Communities’ properties,” said Rodrigo Niño, CEO and founder of Prodigy Network. “The response of the crowd is far exceeding our expectations. The appetite for Manhattan commercial real estate is global. In less than a year we have closed three Manhattan projects with anticipated values exceeding $575 million.”
“We are very excited to expand our relationship with Prodigy Network in the recapitalization of AKA United Nations. The AKA platform continues to be the market leader in luxury furnished residences throughout the United States and we continue to look for opportunities to grow our portfolio,” said Bradley J. Korman, Co-Chief Executive Officer of Korman Communities. “Prodigy Network has proven to be the premier provider of crowdfunded equity and we are very proud of our partnerships together.”
The Midtown East location is at the heart of the United Nations Plaza district. The building is less than two blocks from the United Nations headquarters and three blocks away from Grand Central Terminal, one of the city’s main transportation hubs. The property is situated on a quiet residential street, and close to a number of museums, renowned restaurants, flagship retail destinations, and elite schools.
Developer Korman Communities carries forward a name synonymous with integrity, market savvy and proven performance in the real estate development and investment arenas. Korman’s reputation reflects four generations of dedication and business acumen, resulting in the construction of more than 30,000 single-family homes and 12,000 apartments and townhouses. Korman owns and operates properties in New York City, Philadelphia, Beverly Hills, Washington, D.C., and London.
AKA balances the style and hospitality of an intimate hotel with the space and comfort of a fully appointed luxury condominium. Specializing in stays of a week or longer, AKA stands for unparalleled metropolitan locations; signature design; and exceptional business, entertainment and lifestyle services.
“The acquisition and crowdfunding of AKA UN is consistent with our strategy of investing in discrete institutional quality assets, which historically have been unavailable to smaller accredited investors,” said S. Lawrence Davis, Principal of Prodigy Capital Group, parent company of Prodigy Network. “With over $240 million of senior and subordinate debt provided by major money center banks and domestic pension funds it is clear that traditional institutional financing sources embrace crowdfunding.”
Prodigy Network has led six international and U.S.-based crowdfunded projects, raised more than $300 million from 6,200 investors, and is currently developing projects globally with a projected value of more than $850 million.
Eastdil Secured LLC represented the seller in the transaction.
About Prodigy Network
Founded in 2003, Prodigy Network specializes in connecting its network of accredited investors with opportunities to participate in prime commercial real estate in Manhattan. With its proven crowdfunding model and use of a third-party fund administrator, Prodigy Network has shifted real estate investment opportunities and returns – that once were solely accessible to large investors – to smaller accredited investors. As the leader of the world’s largest crowdfunded skyscraper BD Bacata, Prodigy Network has raised more than $300 million from 6,200 investors globally with a projected value of over $850 million. Prodigy Network is headquartered in New York City. www.prodigynetwork.com
About Korman Communities
Korman Communities is a fully integrated real estate company with development, management and financial capabilities. Korman Communities is comprised of three residential real estate brands: AKA, ARK and AVE. The four-generation firm has constructed more than 30,000 single-family homes, 12,000 apartments and townhouses, as well as 2 million square feet of industrial and commercial space. www.kormancommunities.com
AKA, a division of Korman Communities, is an innovative and growing portfolio of luxury serviced residences in prime urban locations including New York City (4); Philadelphia, Beverly Hills, Washington, D.C., and London. Across the brand, architecturally inspired, spacious accommodations offer the privacy of a luxury residence integrated with hotel services and amenities. While each property is unique and has distinct resident offerings, all feature AKA brand standards and amenities such as exclusive evening lounges, cafes, fitness centers; full-service business centers with meetings space and complimentary high-speed Internet access; en-suite dining; 24-hour front desk assistance and dedicated doormen. All suites include top-of the-line, fully accessorized kitchens, contemporary furnishings, luxurious bathrooms, meticulous housekeeping and premium cable. www.stayaka.com
Prodigy Network Media:
Thea Linscott, 212-920-7057
Cassandra Small, 212-868-1900, ext. 393