Axonic Capital Closes $30.8 Million Senior Loan to Facilitate Deugen Development’s New Jersey Asset

Off-market deal funds acquisition, carry and demolition costs for existing office building, supporting a future 340,000 SF Class A industrial asset

NEW YORK--(BUSINESS WIRE)--Axonic Capital LLC (“Axonic”), an alternative investment management firm specializing in structured credit and commercial and residential real estate debt and equity, announced the closing of a fully funded $30.8 million senior loan to acquire, carry and demolish 5 Wood Hollow Road, a future industrial development project from Deugen Development (“Deugen”).

5 Wood Hollow Road is an existing 330,000-square-foot Class-B office property located in Parsippany, New Jersey that will be vacant by year end.

The senior loan funds Deugen’s purchase of asset and its pre-development costs, and will support the property’s future conversion into a Class-A industrial space. Demolition of the property is estimated to begin in late spring 2027, and once completed, the property will be developed into a 340,000-square-foot Class-A industrial property. Other terms of the transaction were not disclosed.

This deal, sourced directly from the borrower, presents an attractive opportunity for Axonic to lend to an experienced, local developer in a gateway market with strong demand for premium product.

“We continue to see opportunities to finance strong, local developers in high-quality asset repositionings,” said Erik Nygaard, Principal and Portfolio Manager at Axonic.

Axonic worked closely with Kyle Mathis and Eric Gormeley of Deugen Development to arrange the transaction.

"The acquisition of 5 Wood Hollow aligns perfectly with our investment thesis of targeting premier industrial development projects in markets with strong demand and high barriers to entry," said Kyle Mathis, Chief Investment Officer at Deugen Development. "The I-287 corridor's direct access to major transportation infrastructure and deep concentration of sophisticated industrial users make Parsippany one of the most compelling locations in the Northeast for this asset class."

About Axonic Capital

Founded in 2010, Axonic Capital is a New York-based alternative investment manager with approximately $8 billion in assets under management. The firm has deep expertise in structured credit and commercial and residential real estate debt and equity. Axonic’s flexible capital base includes private limited partnerships, separate accounts, insurance company mandates, and publicly listed fund structures. For additional information, visit axoniccap.com.

About Deugen Development

Headquartered in Paramus, New Jersey, Deugen Development is a multi-generational, family-owned real estate firm specializing in acquisition and development of commercial real estate across New Jersey. Deugen controls the full development cycle from site selection and entitlement through construction and asset management. The firm has developed and constructed industrial, multifamily, self-storage, and retail properties throughout the state, with its current investment focus on ground-up industrial development and value-add repositioning in New Jersey's most supply-constrained infill markets. For additional information, visit deugen.com.