NEW YORK--(BUSINESS WIRE)--Today, Dune Real Estate Partners (Dune), a leading national real estate investment platform, together with TF Cornerstone (TFC), a New York City based, integrated residential and commercial developer, announced the creation of a new $1 billion venture, Alta Residential. Dune and TF Cornerstone have identified the conversion of office buildings to residential as a generational opportunity given the scale of the distress in office real estate together with the unmet demand for housing in the U.S. In New York City alone, over 18 million sq. ft. (over 18,000 units) of conversions are in some stage of redevelopment. Dune and TFC believe that the conversion opportunity will compare in scale to the single family for rent trend following the global financial crisis. Importantly, conversions can help revitalize downtowns and enjoy significant support from state and local governments while avoiding much of the embodied carbon generated by new construction.
Dune and TF Cornerstone will source, analyze and due diligence potential conversion opportunities on behalf of Alta. The team will provide construction oversight of local developer joint ventures leveraging TFC’s considerable construction capabilities. It is further expected that TFC and Alta will jointly develop certain New York City conversions.
TFC, a privately held developer with more than five decades of experience, has developed more than 21 million square feet of residential and commercial properties. TFC has extensive development capabilities, and has previously completed 15 commercial to residential developments, totaling nearly 5 million square feet. Previous conversions include 95 Horatio Street, a former refrigeration facility in Manhattan’s Meatpacking district that was converted to 318 residential units, and The Fairfax, a former FBI headquarters building in New York City, which was converted to 313 residences.
“Alta is well-positioned to respond to the current market bringing together Dune’s extensive experience in opportunistic investing during periods of real estate capital markets dislocation together with TFC’s unique conversion experience and development capabilities,” said Thomas Elghanayan, CEO of TFC Cornerstone. “Given the need for owners of underperforming office assets to reevaluate the highest and best use of their properties, combined with ever-increasing need for new housing, we are confident that we’ll be able to scale Alta very quickly.”
“Investors have reacted very positively to Alta as a means to access high quality urban residential, and we have already received significant interest from a wide range of investors. The value proposition created by Alta is exciting in that it represents an opportunity at a national scale; has the potential to deliver compelling investment returns; supports the critical need to create new housing; and advances economic revitalization and sustainability. Each of these categories individually are very attractive to investors - and Alta combines all four,” said Dan Neidich, CEO of Dune.
Alta intends to target locations with high barriers to entry with desirable, transit-oriented residential neighborhoods. Initial target cities are expected to include New York City, Washington, DC, Boston, Charlotte, Raleigh, Atlanta, Dallas, San Francisco and Los Angeles.
About Dune Real Estate Partners
Dune Real Estate Partners is a New York City-based real estate investment firm executing a strategy focused on high yielding real estate equity investments resulting from capital markets dislocation, primarily in the United States. Dune manages the Dune Real Estate Funds, which are led by Mr. Daniel M. Neidich and Ms. Cia Buckley Marakovits and have raised more than $4 billion of equity capital to date. Dune invests on behalf of high-net-worth individuals, pension funds, sovereign wealth funds, endowments and other large institutions.
About TF Cornerstone
TF Cornerstone is a New York City based, family-owned real estate development company. The company is committed to long-term, multi-generational ownership and management and becomes a permanent fixture in all communities where it develops. From initial planning and construction, through leasing and management, TFC cultivates and supports surrounding communities long after a project’s completion. Founded by Tom and Fred Elghanayan in 1970 with the renovation of a small brownstone, TFC now owns and operates nearly 12,000 residential units in Manhattan, Brooklyn and Long Island City, and over 4 million square feet of commercial, office and retail space in NY, DC, VA and PA.
