Cushman & Wakefield Helps Savanna on Trophy Tower Deal
- Sep 23, 2015
By Gail Kalinoski, Contributing Editor
Savanna, which had put One Court Square in Long Island City, N.Y., on the market earlier this year, has instead refinanced the 1.5 million-square-foot, Class A office and retail tower for $315 million.
Natixis Real Estate Capital L.L.C. provided the fixed-rate senior mortgage loan that was arranged by Cushman & Wakefield, which served as the exclusive advisor to the joint venture led by Savanna. The private equity and real estate company bought the controlling interest in the 52-story Queens tower last fall for an undisclosed amount from David Werner and his investor group, which reportedly still owns a stake in the trophy tower also known as the Citigroup Building. Designed by Skidmore, Owings & Merrill, L.L.P., the building has been leased entirely by Citigroup since its completion in 1989. It is the tallest structure outside of Manhattan in New York state.
“In addition to the strong attraction of the asset quality, premier sponsorship and credit tenancy, Long Island City has become a highly sought-after submarket in New York City,” Steve Kohn, president of the Cushman & Wakefield Equity, Debt and Structured Finance team that represented the JV in the transaction, said in a prepared statement.
Other members of the team were: John Alascio, Alex Hernandez, Chris Moyer and Alex Lapidus.
“Notwithstanding the recent volatility in the capital markets, lenders appreciated the credit cash flow and the attractive basis,” Hernandez, a managing director, added in a prepared statement.
Another Cushman & Wakefield team, led by Robert Knakel, chairman, New York investment sales, had marketed the property for sale beginning in May. At the time, numerous media reports speculated the asset, which also includes an attached five-story annex building, could sell for more than the nearly $500 million it had sold for back in 2012. SL Green Realty Corp. and JP Morgan had owned the trophy tower in a 30/70 joint venture at the time it was sold.
It’s not clear why Savanna apparently pulled the property off the market. The tower is fully leased to Citigroup through 2020. Located in the middle of Long Island City, a thriving submarket that is seeing significant commercial and residential construction, the building has unparalleled views of the New York City skyline and offers a quick subway into Manhattan, including direct access to Grand Central Terminal and Midtown West.
The marketing material from Cushman & Wakefield noted there were over 19,200 residential units either planned or under construction in Long Island City, which would increase the population there to about 160,000 people. It indicated One Court Square could make “an optimal residential or retail conversion opportunity.”
Savanna has been active with other New York City properties it owns within recent months, selling 31 Penn Plaza, an 18-story, 440,000-square-foot office building to the Vanbarton Group L.L.C. for a reported $265 million in August.