Bank OZK finances construction of 282-unit Yonkers rental at Ridge Hill

Construction has started on The Ibex at Ridge Hill, a 17-story, 282-unit rental building going up inside the open-air lifestyle center in Yonkers, and Bank OZK is providing the construction financing for the $140 million project. Connect CRE reported the start and named the joint venture behind it as Saber-Hightower, Rafferty Real Estate and Eagle Realty Group.

Twenty-eight of the units are affordable, a bit under one in ten, and the report does not identify the program they run through or whether the set-aside was a condition of approval or the sponsors' own call. Nor does it size OZK's facility. That omission matters more than the headline number: $140 million is the project cost, not the loan, and the two are not interchangeable when the question is how much of the basis the bank is carrying.

Against the unit count, the $140 million comes to just under $500,000 a unit of all-in cost, which is the figure the rents will have to answer to once the building leases. On a 282-unit tower wedged into a retail center, the credit's real question is the gap between that cost and the debt: whether OZK's facility covers most of the build or whether mezzanine or preferred equity sits behind it. The report does not indicate that either is present.

Building apartments into a center that already has parking, access and tenants is a different proposition from breaking ground on a bare site, and likely a shorter path to a first certificate of occupancy — an inference from what Ridge Hill is, not something the coverage asserts. The documented facts are the three sponsors, the single bank, the 17 stories and the $140 million.

What the account leaves out is timing. It begins a sentence on the first units and stops there, so there is no delivery date from this report, and delivery is the input that decides when a construction loan stops behaving like one and becomes a lease-up bet. For the equity in a project of this size, the size of the loan and the arrival of the first tenants are the two variables that set the outcome; the all-in basis, at least, is on the record.