NYC trophy buildings find refinancing, secondary markets suffer

TRD New York /
Jan.January 24, 2012 04:30 PM

Banks and insurance companies are avoiding secondary U.S. markets and directing their refinancing funds to a select group of borrowers in urban centers as mortgages from the real estate boom begin to mature, Bloomberg News reported.

More than 50 percent of the $19 billion in commercial property loans set to mature this year may fail to find refinancing, according to data from Standard & Poor’s, but those in New York City like 350 Park Avenue have the best chance, Bloomberg said.

“Having a New York City trophy asset in a [commercial mortgage-backed securities] deal, if it is a true trophy, generally is a positive for investors,” said Julia Tcherkassova, a commercial mortgage bond analyst at Barclays Capital. Outside of major metropolitan areas “there are going to be fewer competitors bidding and when the buildings lose tenants it’s difficult to replace them.”

There may even be some competition when it comes to refinancing the city’s most prestigious towers.

Harris Trifon, global head of commercial real estate debt research at Deutsche Bank, added: “There is a long line of people who are willing and able to recapitalize trophy assets.”

One example of a trophy property that just got refinanced is 350 Park Avenue. Vornado Realty Trust just got $300 million from New York Community Bank to refinance the property, it was recently reported. [Bloomberg]


Related Article

arrow_forward_ios
329 Broadway and JLJ CEO Jonathan Lewis (Credit: Syndicate Architecture via CityRealty, Google Maps)

Williamsburg developer lands $57M refi to complete 329 Broadway

(Credit: iStock)

Despite housing market slowdown, mortgage lenders just had a great second quarter

Homeowners are rushing to refi mortgages as rates drop

Rudin Management closes $550M refi at
345 Park Avenue

Normandy, Drake Street refi LIC
warehouse-to-office conversion
with $75M Deutsche loan

Lightstone Group lands $210M loan for Gowanus rental development

Why Chase is turning to Pinterest to take on the “most competitive market” in 20 years

Sutton, Sitt score $305M refi for
530 Broadway

arrow_forward_ios