The Real Deal New York

Vornado closes another $750M in 220 CPS financing

Term loan facility follows REIT's $950M loan from Bank of China in September

November 02, 2015 12:50PM

220 Central Park South

Rendering of 220 Central Park South in Midtown (inset: Steven Roth)

Vornado Realty Trust secured $750 million in financing toward its luxury condo tower development at 220 Central Park South, just two months after pulling off a $950 million construction loan.

The real estate investment trust drew $187.5 million upon closing the unsecured delayed-draw term loan facility, which matures in October 2018 with two one-year extension options, it said Monday.

The loan facility follows an additional $350 million that Vornado secured from the Bank of China in September — taking its total borrowing from the Chinese lender for the 220 Central Park South project to $950 million.

The interest rate on this latest term loan – provided by a group of arrangers and bookrunners including J.P Morgan Securites and Merril Lynch, Pierce, Fenner & Smith Inc. – is LIBOR plus 115 basis points, Vornado said, with a fee of 20 basis points annually on the unused portion of the financing.

The facility stipulates that all draws must be made by October 2017 — with the maximum amount available to Vornado being twice the amount outstanding on the facility as of April 29, 2016, up to the $750 million borrowing limit.

Vornado, led by chair and CEO Steven Roth, had $2.5 billion in undrawn revolving credit facilities before closing the $750 million term loan facility, it said.

The REIT recently entered an agreement to sell its leasehold interest in a 27-story, 473,000-square-foot building at 20 Broad Street in the Financial District to MetroLoft founder Nathan Berman for $200 million. – Rey Mashayekhi