Bank of America is tapping the commercial mortgage-backed securities market to refinance the debt on its namesake Manhattan office building, providing BofA and building co-owner The Durst Co. with a hefty cash-equity payout.
According to ratings agency presale reports, BofA and Durst will share $200 million to $300 million in equity proceeds as part of the $1.6 billion refinancing package that will retire approximately $1.3 billion in existing debt.
The refinancing will involve $950 million in commercial-mortgage backed bonds being marketed through a single-asset, large-loan securitization, cross-defaulted with a $650 million subordinate loan that will back a tax-exempt refunding bond issuance via a trust sponsored by the New York Liberty Development Corp.
The CMBS loan was placed in One Bryant Park Trust 2019-OPB, which will offer a single $902.5 million Class A note tranche to investors. The notes have preliminary triple-A ratings from Moody’s Investors Service and Kroll Bond Rating Agency.
Moody’s also rates the $47.5 million in notes representing a horizontal risk-retention stake in the transaction.
The Class A office building located at 42nd Street and 6th Avenue is noted as the first high-rise in the country to receive LEED certification for environmental sustainability in its 2008 construction, which originally cost $1.84 billion.
BofA’s New York headquarters occupies 77.9% of the net rental area of the building, which is the fifth tallest in Manhattan.
The tower also houses the New York offices of law firm Akin Gump Strauss Hauer & Field.
