Vornado Realty Trust and Crown Acquisitions closed on $450 million in financing for their retail condominium at the St. Regis Hotel and an adjacent retail townhouse at the corner of Fifth Avenue and 55th Street in Midtown, Vornado announced Tuesday.
The loan matures in December 2020 and includes two one-year extension options, the real estate investment trust said. Vornado partnered with Stanley Chera’s Crown Acquisitions to buy the St. Regis retail condo at 2 East 55th Street and the adjacent townhouse at 697 Fifth Avenue for $700 million last year.
Vornado owns 74.3 percent of the joint venture that owns the properties, it confirmed, while Crown Acquisitions owns the remaining 25.7 percent.
The landlords signed luxury retailer Swatch Group to two 15-year leases earlier this year for all of the space at the properties, which span nearly 25,000 square feet in the heart of the vaunted Upper Fifth Avenue retail corridor.
Retail rents on Fifth Avenue, between 49th and 60th streets, hit $3,500 per square foot through the first half of this year – up 3.6 percent from a year earlier, according to Cushman & Wakefield, to remain the most expensive retail leasing market in the world.
Jeff Sutton’s Wharton Properties and General Growth Properties recently signed Italian luxury retailer Bulgari to a new 15-year deal at the Crown Building at 730 Fifth Avenue, located two blocks up from the St. Regis retail space.
The Bulgari deal set a new city record with rents in excess of $5,000 per square foot, as The Real Deal reported last month. – Rey Mashayekhi