L&L Lands $911M Loan To Refinance Citadel-Anchored Park Avenue Tower
L&L Holding Co. has scored a massive refinancing deal for a Midtown Manhattan skyscraper where hedge fund Citadel is the anchor tenant.
Sumitomo Mitsui Trust Bank provided a $911M debt package to the New York developer for 425 Park Ave., a 670K SF office tower completed in 2022, L&L announced Thursday.
The property is 90% leased, mostly to financial and investing firms, with Ken Griffin’s Citadel occupying 440K SF across 22 floors as the building’s anchor tenant.
“This massive loan package demonstrates the lending market’s continued capacity and appetite to finance ultra-premium, highly-amenitized and well-located office towers owned and operated by first-rate sponsors,” L&L President and Chief Investment Officer Rob Lapidus said in a statement.
L&L plans to use the refinancing deal to pay off a loan of the same size issued in 2021 to fund construction and leasing.
Office owners have struggled to find refinancing deals since the onset of the pandemic. S&P analysts wrote in January that the sector is “effectively unfinanceable.” Banks have been reluctant to lend on office assets as tenant demand fell while interest rate hikes left borrowers with a high cost of capital.
But there is growing evidence that some lenders are confident in the future of NYC's office market.
Sumitomo Mitsui Trust Bank’s five-year, floating-rate loan on L&L’s 47-story tower is the second office refinancing deal of more than $100M issued in Manhattan this week. With Williams Equities nabbing a $155M CMBS loan from Citi Real Estate Funding for an office-heavy Flatiron property at 28-40 W. 23rd St., lenders have doled out more than $1.1B in fresh office debt this week.
Other office landlords that have nabbed big refinancing packages for office space include SL Green, which last week refinanced 10 E. 53rd St. to the tune of $205M from lender Wells Fargo. Last month, Blackstone notched a $308.5M CMBS loan from Morgan Stanley for a 36-story office tower at 65 E. 55th St.
