BHI, the U.S. branch of Bank Hapoalim, has committed $71.5 million in construction financing for a 250-unit multifamily project in Bayonne, New Jersey. The loan backs The Standard, a new apartment community developed through a joint venture between Prestige Development and Anak Development. Maven Capital's Sean Shahkohi brokered the transaction.
Bayonne sits directly across the Hudson River from Manhattan, making this northern New Jersey location attractive to renters seeking proximity to New York City employment centers without the premium pricing of Brooklyn or Queens. The Standard enters a market where Class A multifamily construction remains competitive but where rental demand from displaced Manhattan renters continues to support new supply.
The $71.5 million financing represents substantial commitment from BHI, the American subsidiary of Bank Hapoalim, Israel's largest bank. Construction lending at this scale signals confidence in both the sponsorship's track record and the Bayonne submarket's absorption capacity. BHI has been active in U.S. multifamily construction lending over the past several years, competing alongside larger regional and national lenders in the New Jersey market.
Prestige Development and Anak Development bring combined experience in New Jersey residential development. The partnership structure allows both firms to pool resources and risk on a project of this size. For a 250-unit property, construction costs likely run $60 million to $75 million when accounting for labor, materials, and soft costs in the New Jersey market, placing the $71.5 million loan at a reasonable loan-to-cost ratio.
For renters, The Standard's completion adds supply to a Bayonne market that has seen limited new construction in recent years. Multifamily rents in northern New Jersey have risen steadily through 2023 and 2024 as demand outpaced supply. New units will moderate rate growth but won't eliminate the rent growth differential between northern New Jersey and New York City proper.
For investors and landlords, this financing event demonstrates continued capital availability for multifamily construction despite higher interest rates. Banks remain willing to fund quality sponsors with strong track records, particularly in supply-constrained submarkets near major employment centers. Existing apartment operators in Bayonne face new competition once The Standard stabilizes, likely within 18 to 24 months from construction start.
Construction financing typically involves a 24- to 36-month draw period, with permanent financing secured before or shortly after stabilization. The Standard's sponsors will need to secure permanent debt, likely through CMBS, agency lending, or portfolio lenders, once the property reaches 90 percent occupancy and demonstrates stabilized operations.
This deal reflects broader trends in New Jersey multifamily. Lenders favor projects in transit-accessible locations near New York City over standalone suburban complexes. Bayonne's PATH train connection to Newark provides additional transportation benefit beyond car commuting. As inflation moderates and rate environments stabilize, construction lending velocity will likely accelerate through 2025.