Vornado Completes $168M Manhattan Office Refi
- Jan 31, 2019
A joint venture that’s 45.1 percent-owned by Vornado Realty Trust has completed a $167.5 million refinancing of 61 Ninth Ave. in Manhattan’s Meatpacking District.
Rafael Viñoly Architects designed the newly constructed nine-story, 170,000-square-foot, Class A office building. The office space is fully leased to Aetna, and its retail component is home to the world’s largest Starbucks store.
The seven-year, interest-only loan carries a rate of LIBOR plus 1.35 percent (currently 3.79 percent) and matures in January 2026. Vornado reportedly realized net proceeds of about $31 million in the transaction. The loan replaces the previous $90 million construction loan, which bore interest at LIBOR plus 3.05 percent and was scheduled to mature in 2021.
A Vornado spokesperson declined to provide additional information requested by Commercial Property Executive.
The property is subject to a 101-year unsubordinated net ground lease held by Prince Lumber, the previous occupant of the site, according to Yardi Matrix.
Class A surge spurs rents
The average Class A asking rent in Manhattan’s Midtown South “jumped 10 percent in the third quarter to $93.40 due to the completion of several new Class A office buildings in the Meatpacking/Chelsea area,” according to a third-quarter 2018 report from the Alliance for Downtown New York.
That reportedly was a key factor in Lower Manhattan’s overall average asking rent having hit $63.70 per square foot, a new record and the second record-setting quarter in a row, also per the ADNY report.
Image courtesy of Vornado