Major Developments:
Irvine Co. refinanced the MetLife Building at 200 Park Avenue with a $1.5 billion loan at 6.25%. The 58-story, 3 million-square-foot building is 94% occupied and generates $170 million in net operating income. Ownership has invested $180 million in the property prior to the year before the pandemic.RFR Holding is finalizing a $1.2 billion CMBS loan to refinance the Seagram Building at 375 Park Avenue. The 38-story, 860,000-square-foot property was appraised at more than $1.8 billion.
RFR Holding recapitalized 475 Fifth Avenue in Midtown, Manhattan after facing a foreclosure threat from its lenders, landed a three-year, $160 million loan for the 23-story building, as well as an equity infusion from unnamed partners.
RFR has a second foreclosure at 285 Madison Avenue. DAOL Asset Management, which provided RFR Holding with mezzanine debt on the property, has scheduled a foreclosure auction for April 15th. Alongside the auction, the lender is also shopping the debt for sale, hoping for eyeing a price north of $300 million. RFR is also facing foreclosure on the property from the CMBS bondholders.
Fred Ohebshalom lands a refinancing for the Fifth Avenue Hotel. The new loan from KSL Capital Partners and Columbia Pacific. The 153-key hotel was constructed to pair the original five-story building with a new 23-story tower. The hotel opened in 2023 with rates between $800 to $3,000 a night.
Flooding could wipe out 19,000 NYC homes in the next 15 years. Damage and destruction expected to rise with climate change. The devastation could be more than Hurricane Sandy. Rising sea levels and intensifying storms could devastate coastal neighborhoods. An additional 24,300 housing units are at risk of substantial damage from major storms by 2040. There’s a 1% chance of a major storm occurring in any given year.
315 West 36th Street was just appraised for $26.4 million or $185 per square foot and is also well below its $77 million loan. Walter & Samuels has similar distress across its aging office portfolio.
Google is looking to sublease 165,000 square feet at 345 Hudson Street. There’s more than 400,000 square feet directly available in 345 Hudson Street of the building's 980,000 RSF-foot . The average for the neighborhood is $88.85 per square foot.
DOJ tells prosecutors to drop charges against Eric Adams. The mayor would shed 5 count indictment for bribes and fraudulent campaign donations.
The Roosevelt hotel has closed as a migrant intake center which could lead to a full-block development at 45 East 45th Street. The city plans to transfer the functions of the facility elsewhere in the next few months.
The Hotel Penn site: Vornado said that the office project planned there would be the next site to be developed in the Penn District, but the finances around ground-up development are still prohibitive.
The tower planned for 350 Park Avenue will break ground over the next few years. Demolition of the existing office building is expected to begin next year.
The Justice Department has directed prosecutors in Manhattan to drop criminal charges against Mayor Eric Adams.
The U.S. Immigration Fund has indicated that it wants to bring on Cirrus Real Estate which is led by former BlueMountain Capital and Fortress Investment Group executives.
USIF says it has signed a letter of intent with Cirrus to come on as co-developer, to lead capitalization of Pacific Park Development Rights where 3,200 units can be created. It is still finalizing another co-developer to bring on. USIF will need to present its plan (all developers, the structure of its agreement with these parties, to Empire State Development, which needs to sign off.
The phones of Jesse Hamilton, and Diana Boutross were seized, as the two were returning from a vacation together in Japan with Mayor Eric Adams. Hamilton oversees the city’s office leases at the department known as DCAS, and Boutross, who handles those leases for Cushman & Wakefield. Since then, leadership at the agency hasn’t changed, and the city continues to lease and acquire properties.
A&E Real Estate faces foreclosure on a city-wide portfolio of 3,500 units, including the 1,200-unit Riverton Square rental complex in Harlem and 37 tax lots on the $506 million loan. Wells Fargo, serving as trustee for the bondholders of a $506 million loan, filed a pre-foreclosure action against A&E. A&E allegedly defaulted when the loan matured.
Tax Equity Now, New York’s eight-year-old lawsuit against the city over its property tax system continues. The group filed a motion seeking to force the city to make changes to how one-, two- and three-family homes, as well as condo and co-ops, are assessed, without legislation.
First Deputy Mayor Maria Torres-Springer indicated that 500 housing units are underway, thanks to the office-to-residential tax incentive known as 467m. The developers can’t officially apply for the tax break until construction is complete. She also said interest in 485x, the replacement program for the property tax incentive 421a, is picking up, though she didn’t provide any updated statistics.
The administration is planning to release a request for expressions of interest in the spring for the warehouse at the center of the former Amazon HQ2 site. The city's Economic Development Corporation is expected to solicit ideas for commercial, light industrial and community-oriented uses. The center of the planned headquarters site is 44-36 Vernon Boulevard, a 672,000-square-foot warehouse occupied by the Department of Education. The relevant site also includes two city-owned parking lots, which are controlled by the Transportation and Small Business Services departments.
A New York judge ruled that New York REIT which owns a majority stake in the 2 million square-foot complex at 825 Eighth Avenue alongside RXR and SL Green can take control of a $90 million pot of money. This was at the center of a years-long battle between the two firms. The money had been set aside to help lease a big vacancy about 30% of the building left behind by the law firm Cravath Swaine & Moore.
The 2019 Housing Stability and Tenant Protection Act changed the rules around rental to condo/co-op conversions. The HSTPA bumped that threshold to 51%. For example, projects that received the property tax break 421a or those that used low-income housing tax credits in the 1990s have affordable apartments that are poised to go market-rate. The affordability requirements on such projects typically last 30-plus years. 485x, requires permanent affordability.
