Maefield Development is looking to raise $300 million in EB-5 financing for its $2 billion revamp of 1568 Broadway, which includes physically elevating the historic Palace Theater by 29 feet, according to documents circulated to Chinese investors.
The EB-5 program, which offers foreign investors a U.S. green card in exchange for a $500,000 investment, has become a popular source of capital for developers, especially in a tough financing environment.
Maefield , an Indianapolis-based real estate investment firm, acquired the leasehold interest for the 468-room DoubleTree Guest Suites Times Square hotel, at Seventh Avenue and West 47th Street, from Sunstone Hotel Investors for $540 million last year — a deal that valued it at just over $1.15 million per key.
Maefield’s redevelopment of the property, done in partnership with Nederlander Organization, is slated to include a renovation of the hotel, a new retail and entertainment space and a new “super-high-resolution” LED screen on which to display advertising. In order to build the new retail space, the company will have to lift the theater. The project was approved by the New York City Landmarks Preservation Commission last month.
The revamped hotel will have 704 rooms and a rooftop bar and restaurant.
The Palace dates back to 1913 and is one of the longest running theaters on Broadway.
Howard Michaels of the Carlton Group, who arranged the acquisition financing for the hotel, was not immediately available for comment on how Maefield plans to finance the revamp. A spokesperson for Maefield declined to comment.