SL Green Realty and Ivanhoe Cambridge refinanced their interest in a Midtown office tower at 1745 Broadway with a $375 million loan from Bank of China, following a decision by Penguin Random House to stay at the building.
The partners had previously thought about selling their stake in the property, which totals 685,000 square feet across floors two through 25. It was expected to fetch north of $700 million. But when Penguin opted to re-up at the building last year, they decided to take it off the market, sources said.
While the total balance of the loan is $375 million, the initial advance delivered to the borrowers is $345 million, according to loan documents.
A spokesperson for SL Green did not immediately respond to a request for comment, while Bank of China could not be reached.
SL Green first bought a minority stake in the building in partnership with the Witkoff Group for $509 million in 2007, and later bought out Witkoff’s stake, records show. The Related Companies developed the 50-story tower in the early 2000s, setting aside the upper half of its floors for residential condo units. Those units have since been sold.
The Bank of China deal may pour some cold water on reports that Chinese overseas investment is poised to drop for the first time in about 15 years.
A recent report by the Chinese Academy of Social Sciences predicted that total direct investments would be around $118 billion in 2017, down from $170 billion in 2016.
Bank of China, a state-owned enterprise, was one of the largest foreign lenders on U.S. real estate projects since the 2008 financial crisis.