Kinsmen, SK Development Land $203.5M Loan for East Village Towers

Kinsmen Property Group and SK Development have closed a $203.5 million construction loan for their 184-unit East Village project at 50 Third Avenue, Walker & Dunlop announced, financing twin 17-story towers on a site the developers spent roughly four years assembling lot by lot.

Why it matters

Walker & Dunlop’s Capital Markets Institutional Advisory group arranged the floating-rate, interest-only loan through Ironsand, a real estate private debt manager, for the joint venture between Kinsmen Property Group and SK Development. The project calls for two adjoining Class A buildings on separate tax lots at 50 Third Avenue, near East 11th Street, built to function as a single structure with a shared lobby: a 99-unit south building with 5,967 square feet of ground-floor retail and an 85-unit north building with 3,812 square feet of retail. Of the 184 total units, 37 are designated affordable for households earning up to 80% of area median income under the city’s 485-x tax abatement. “The East Village combines exceptionally limited new housing supply with sustained renter demand,” Walker & Dunlop’s Aaron Appel said of the deal.

The numbers

City deed records show the development entity behind the site, 62-64 Third Ave L.P., spent $44.7 million assembling four Third Avenue lots between August 2018 and February 2022, a basis we reported on October 13 alongside the developers’ pursuit of unused air rights from neighboring St. Mark’s Church in-the-Bowery to add bulk to the north tower. The $203.5 million construction loan now closing is roughly 4.5 times that land cost, consistent with typical ground-up leverage in Manhattan rather than a stretched capital stack. Commercial Observer reported the project carries a fallback: if the Landmarks Preservation Commission denies the air-rights transfer and the two-tower plan, the developers would instead build a single 184-unit market-rate building on the combined site.

What’s next

The loan closing moves the project from land assembly and zoning maneuvering into active construction financing, with the Landmarks Preservation Commission’s review of the St. Mark’s air-rights transfer still the swing factor on whether the final building splits into two towers with the affordable component intact. Watch for a DOB NOW permit update reflecting the financed scope and for the LPC calendar date on the church transfer. For more on development moving through the East Village and the rest of Manhattan, see our New York market coverage.