Tishman Speyer And Silverstein Properties Find a Way to Refinance Manhattan Office Tower

By Franco Faraudo

Refinancing an office building might seem like a doomed proposition in today’s environment of high interest rates and low occupancy. But that is exactly what Tishman Speyer and Silverstein Properties were able to do with their Midtown Manhattan office building 11 West 42nd St. The two New York real estate giants worked with Bank of America and Taconic Capital to refinance $330 million of debt on the building.

While the terms of the loan are not public the fact that such a large refinancing deal got done shows that there are options for office building owners, even now. Granted, this was no ordinary deal. The building is in an incredible location overlooking Bryant Park and is 99 percent leased up. Plus, the sponsors of the deal are both well know, well-capitalized firms with a long-term relationship with lenders. Even the executives that did the deal recognized all of the things that they had going for themselves. “This loan demonstrates that the capital markets are open and available for well-located, high-quality office assets with strong sponsors and solid customer bases,” said Tishman Speyer Senior Managing Director and Global Head of Debt Randall Rothschild.  Who knows if a struggling building owned by a smaller company would have been able to do the same kind of refinance but this deal at least shows that there are opportunities to get favorable loans on office buildings.

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