ING Finances Sony Building Purchase
- Jun 06, 2016
By Scott Baltic, Contributing Editor
New York—ING Capital LLC has originated a $570 million bridge loan in connection with the acquisition by Olayan America, the U.S. investment arm of Saudi Arabia’s Olayan Group, of 550 Madison Ave. in Manhattan. The short-term loan is secured by a first mortgage on the skyscraper, which was known for much of its existence as the Sony Building.
“ING committed the bridge facility very quickly at attractive terms so that this deal could conclude within a very tight time frame,” Nadim Tabbara, the Olayan Group’s CFO, said in a prepared statement.
The 37-story building in Manhattan’s Plaza District has 852,830 rentable square feet across multiple uses, including about 776,000 square feet of office space, retail frontage on Madison Avenue, and exhibition and museum space.
It’s now in essence entirely vacant, with just one tenant, a restaurant, occupying 5,000 square feet. Olayan and its partner/asset manager, Chelsfield Group Ltd., London, have stated that this gives them the opportunity to “rebrand the building and create value by renovating and reconfiguring the existing space.”
Designed by Philip Johnson and John Burgee with its unique Chippendale-style roof pediment, the building was completed in 1984 as AT&T’s global headquarters. This is only the third time the tower has been sold; it was purchased by Sony Corp. in 2002 and then to the Chetrit Group in 2013.
“The property has been maintained to a high standard and has never previously been available to the open market for office leasing,” Tony Fusco, head of real estate at Olayan America, said in the prepared statement.
Olayan America declined to comment further on the transaction.
“We are delighted to partner once again with Olayan on a trophy property in a world-class city,” Elliott Bernerd, founder and joint chairman of Chelsfield, had commented in Olayan’s announcement about the sale. “We are especially pleased that after our 15-year absence, Olayan America facilitated our return to the U.S. market as asset manager of this iconic property.”
Ron Cohen at JLL advised the buyer, and Doug Harmon at Eastdil Secured advised the seller.
Image courtesy of Yardi Matrix