NY Life Lends $146M on Jersey City Tower
- Jan 19, 2017
By Scott Baltic, Contributing Editor
Jersey City, N.J.—New York Life Real Estate Investors has extended, on behalf of institutional investors, $146.6 million in financing secured by 3 Second Street, a Class A office tower in Jersey City, N.J. The borrower/owner was Dividend Capital Diversified Property Fund Inc. (DPF), of Denver, a public reporting daily NAV REIT.
“Three Second Street is one of the best and most conveniently located office properties along the Hudson Waterfront,” David Li, senior director at New York Life Real Estate Investors, said in a prepared statement.
The 20-story building totals about 577,500 rentable square feet and was completed in 2002, according to information provided by Yardi Matrix. DPF acquired 3 Second Street, formerly known as Harborside, in June 2010 and completed renovations on the main and north lobbies in October 2016.
A New York Life spokesperson was unable to provide Commercial Property Executive with further information.
The floating-rate, non-amortizing loan has an initial term of three years, with two one-year extensions. The deal was structured to advance $127 million on closing, plus another $19.6 million of loan advances over the next three years for leasing costs and improvements, DPF announced separately.
Of the initial $127 million, $110 million was used to repay a mortgage note on a retail portfolio, according to a prospectus supplement filed by DPF. That earlier note had an interest rate of 5.51 percent and a maturity date of June 11 of this year.
The prospectus supplement also stated that the 3 Second Street mortgage note’s interest rate is based on LIBOR, plus a margin ranging from 2.00 to 2.25 percent.
In connection with the note, DPF also entered into an interest rate protection agreement with the Commonwealth Bank of Australia. The agreement has a notional amount of $146.6 million and a LIBOR strike rate of 3.0 percent. The LIBOR rate cap expires Jan. 10, 2019.
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