Vornado Realty Trust and the Canadian Pension Plan Investment Board are tapping the commercial-mortgage backed securities market to finance a mortgage for the historic One Park Avenue building in New York’s Murray Hill neighborhood in Manhattan.
The sponsor’s fee simple interest in the 943,302-square foot office and retail tower, built in 1926, secures a two-year mortgage, $525 million mortgage that was still awaiting closing as of Monday, according to S&P Global Ratings. The building is anchored by the New York University’s administration offices for the NYU Langone Medical Center, which occupy about 60.3% of the net rentable area of One Park Avenue.
The building, which occupies the western half of the block between 32ndand 33rdStreets, is 97.9% leased with a remaining lease term of approximately 22.8 years, according to S&P Global Ratings.
Vornado, a publicly traded REIT, and CPPIB have invested over $64.2 million in capital improvements to the building since 2014, including lobby upgrades, roof replacements, elevator modernization and tenant buildouts. The building is LEED Silver certified for sustainable energy features.
Vornado has 55% of the ownership share of the building.
S&P has issued ratings to four of five issued note classes, including a preliminary AAA to the $294.88 million senior Class A tranche. Kroll issued ratings to all five classes (also an AAA to the Class A tranche) as well as to a $26.25 million horizontal risk-retention tranche (BB+).
