We present a new model for the description of heavy-flavor hadronization in relativistic heavy-ion collisions. We explore its effect on the charmed hadron yields and kinematic distributions once the latter is applied at the end of transport calculations used to simulate the propagation of heavy quarks in the deconfined fireball produced in the collision. The model is based on the formation of color-singlet clusters through the recombination of charm quarks with light antiquarks or diquarks from the same fluid cell. This local mechanism of color neutralization leads to a strong space-momentum correlation, which provides a substantial enhancement of charmed baryon production and of the collective flow of all charmed hadrons.