Two large commercial mortgage-backed securities issuances topped the city’s real estate loans last month, reflecting the continued strength of the CMBS market.
Although CMBS loans from private lenders declined in the second quarter, a total of $59.55 billion in CMBS debt was issued in the first half of the year, a 35 percent increase from a year earlier and the largest volume in more than 15 years, according to Trepp.
Blackstone and Fisher Brothers’ 1345 Sixth Avenue scored the largest CMBS loan, for $850 million, at the same time that Blackstone bought a 49 percent stake in the Midtown office tower. It was Blackstone’s first big move in Manhattan’s office market since 2022.
Downtown, Vornado Realty Trust and Stellar Management scored $675 million in CMBS debt for their massive multifamily complex Independence Plaza, where 40 percent of units are either rent-regulated or designated affordable.
Meanwhile, lenders doled out dollars across asset classes, including a Times Square office-to-resi conversion, multifamily and condos. Even a rent-stabilized buyer scored financing for its purchase of a portfolio of more than 2,000 rent-stabilized properties in the Bronx.
Here are the top five real estate loans in Manhattan, as well as the top five in the outer boroughs:
Blackstone booty | $850M | Midtown
Morgan Stanley, Citigroup and JPMorgan Chase provided an $850 million CMBS loan for Blackstone and Fisher Brothers’ 1345 Sixth Avenue at the same time that Blackstone bought a 49 percent stake in the Midtown office tower. The debt is set to mature in two years – one-tenth of the term of the previous CMBS loan – with three one-year extension options, Traded first reported. As part of the deal, Fisher Brothers made a $175 million down payment and Blackstone made a similar $168 million down payment, according to Crain’s. Fisher Brothers also increased its majority ownership of the building. The investment gave the building a full capitalization of $1.4 billion. That’s a nice jump from late last year, when S&P Global appraised the property’s value at $896 million.
Independence Pay | $675M | Tribeca
Deutsche Bank, Wells Fargo, Bank of America and Morgan Stanley originated a $675 million CMBS loan for Vornado Realty Trust and Stellar Management massive multifamily complex Independence Plaza. In 2018, Goldman Sachs provided a seven-year, $675 million CMBS loan that was set to mature in August. Independence Plaza includes three buildings, located at 40 Harrison Street, 80 North Moore Street and 310 Greenwich Street. There are 1,328 units at the complex, which spans 1.4 million square feet. The complex was initially rent-regulated under the Mitchell-Lama program, but transitioned when Stellar bought into the property in 2003. Still, 40 percent of units are either rent-regulated or designated affordable, split between Section 8 housing and city-supported units.
Conversion cash | $562M | Midtown
Corebridge Institutional Investments provided a $561.6 million loan to Scott Rechler’s RXR, Marc Holliday’s SL Green, and Marc Rowan’s Apollo Global Management for their office-to-residential conversion of 5 Times Square. The three companies are planning to convert the 38-story office building into up to 1,250 units of housing, mostly studios, of which 25 percent would be affordable. The project’s first phase is expected to be completed in 2027.
Tower power | $525M | Long Island City
Madison Realty Capital provided a $425 million loan for Tavros Capital and Charney Companies’ residential tower in Long Island City’s Court Square. The developers are planning a 55-story, 600-unit condominium project at 24-19 Jackson Avenue. Kushner Companies and its capital partner, OneIm, also supplied a $100 million preferred equity investment as part of the deal, Commercial Observer reported. Tavros, Charney and Incoco closed on the long-stalled development site in the summer of 2022, paying $68.3 million for the site from Japanese hotel operator Toyoko Inn. Tavros and Charney already owned a neighboring parcel at 45-03 23rd Street, building the bones of a development that could span 900,000 square feet.
Soft landing | $400M | Greenpoint
JPMorgan and Citibank provided $400 million for Brookfield Properties’ Eagle + West multifamily project in Greenpoint. The property at 1 Eagle Street is a 745-unit double high-rise with a distinctive stacked-box design. The building opened for leasing in 2022 as part of Brookfield’s “Greenpoint Landing,” a master-planned development with an aim of 5,500 residential units. There are 191 rent-regulated units in the combined two buildings, according to 2023 city records. The fresh financing replaces a $400 million loan from Blackstone.
Fixer uppers | $365M | Turtle Bay
Bank of New York Mellon originated a $365 million CMBS loan for the United Nations Development Corporation’s overhaul of two Manhattan office properties. The fresh construction financing is for the office buildings at 323 East 44th Street, also known as 2 UN Plaza, and 787 First Avenue, also known as One UN Plaza. The two properties have 978,000 square feet, according to PincusCo. The United Nations leases the buildings from the city. In addition to offices, One UN Plaza houses the Millennium Hilton.
Big Mack | $235M | Midtown, Financial District
Wells Fargo provided a $235 million loan for seven budget hotels owned by Mack Real Estate Group. The hotels include the Holiday Inn Express Times Square, Hampton Inn Madison Square Garden and Holiday Inn Wall Street. Mack bought the properties out of foreclosure four years ago after the prior owner defaulted on a $300 million mortgage, Crain’s reported. The new mortgage comes due in two years, with three one-year extensions possible and the Macks put up $45 million to secure the loan, according to Crain’s.
Queens | $158M | Long Island City
Nataxis provided a $158.2 million loan to Carlyle Group for the 391-unit residential building One Queens Plaza South. A fund managed by The Carlyle Group purchased the 45-story luxury rental tower in 2018 for $284 million, the most expensive rental building sale in the borough’s history at the time. The fresh financing replaced a $179 million loan from MetLife.
Stabilized stash | $141M | Bronx
PGIM Real Estate provided a $141 million loan to Peter Hungerford’s PH Realty Capital for its purchase of a portfolio of rent-stabilized properties in the Bronx. The portfolio includes 2,021 units totaling 2.1 million square feet spread across five neighborhoods in the Northern Bronx. Hungerford teamed up with David Kaye and Joe Listhaus’ Rockledge to buy the portfolio for $192.5 million from Related Fund Management, which has been working to cut its exposure to the troubled asset class.
Retail refi | $138M | Woodside, Crown Heights, Hamilton Heights
PGIM Real Estate provided a $137.8 million loan to Carlyle Group for three retail properties across three different boroughs – 31-08 Northern Boulevard in Woodside, 1203 East New York Avenue in Crown Heights, and 2926 Frederick Douglass Boulevard in Hamilton Heights. The fresh financing replaces loans from Santander Bank and Deutsche Bank.
Read more
Blackstone, Fisher Brothers land $850M mortgage at 1345 Sixth Ave
Vornado, Stellar snag $675M refi for Independence Plaza
RXR, Apollo, SL Green land $575M for 5 Times Square