Amazon-Leased Long Island Warehouses Land Refi

2 min read

JLL Capital Markets arranged the loan through Provident Bank.

JLL Capital Markets has arranged a refinancing for 1770 Walt Whitman Road and 540 Broadhollow Road, two last-mile distribution facilities in Melville, N.Y.
1770 Walt Whitman Road and 540 Broadhollow Road. Image courtesy of JLL Capital Markets

JLL Capital Markets has orchestrated a refinancing deal for 1770 Walt Whitman Road and 540 Broadhollow Road, two last-mile distribution facilities encompassing a total of approximately 310,000 square feet in Melville, N.Y. JLL secured $35 million for the fully leased, Long Island industrial properties on behalf of the ownership, a private investor.

The JLL Capital Markets Debt Placement team of Thomas Didio Jr., Matthew Pizzolato and Max Custer represented the borrower and arranged the financing, which came in the form of a 10-year, non-recourse loan with a fixed rate through Provident Bank.


READ ALSO: Top 5 NYC Industrial Building Sales


Located in Long Island’s Western Suffolk submarket, 1770 Walt Whitman and 540 Broadhollow occupy adjacent parcels roughly 20 miles outside Manhattan. The warehouse at 1770 Walt Whitman features 213,900 square feet, while the property at 540 Broadhollow encompasses roughly 96,000 square feet. Both Class B buildings are older properties, but they are destined for a renaissance.

In the first quarter of 2021, Amazon leased both 1770 Walt Whitman and 540 Broadhollow under a long-term agreement. Now, the ownership is subjecting them to a capital improvement program that consists of a comprehensive renovation. When all is said and done, the facilities will be fit for a leading e-commerce tenant, with clear heights reaching up to 29 feet, 21 dock-high doors and substantial parking and van loading accommodations.

The makeover of older properties is not uncommon in the Long Island industrial market today. “Investors are now shifting their priority toward redeveloping antiquated office buildings in tandem with adapting to the office market’s flight-to-quality trend to meet evolving market needs,” according to a first-quarter 2022 report by Cushman & Wakefield.

What a lender wants

There are any number of compelling factors that may have attracted Provident Bank and other potential lenders to the opportunity to provide financing for 1770 Walt Whitman and 540 Broadhollow. They aren’t state-of-the-art facilities, but they are fully leased to Amazon, and they are located in a strong industrial market that’s only growing stronger.

“Out of the gate in 2022, the industrial market improved with labor indicators and robust tenant demand,” according to the Cushman & Wakefield report. With demand outpacing supply, Long Island’s industrial vacancy rate plummeted to a historic low of 2.3 percent in the first quarter of 2022, and the vacancy rate was even lower in Western Suffolk, home to the newly refinanced Amazon properties, at a mere 1.2 percent.

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