Fosun looking for $800M to refi 28 Liberty

Chinese conglomerate bought skyscraper for $725M sans traditional debt

TRD New York /
Jul.July 19, 2017 01:15 PM

Fosun’s Bo Wei and 28 Liberty

Fosun International is seeking a loan of up to $800 million to refinance 28 Liberty Street, sources told The Real Deal, taking the next step in its repositioning of the 2.1 million-square-foot Lower Manhattan tower it bought for $725 million in 2013.

The Shanghai-based conglomerate tapped CBRE’s Tom Traynor and James Millon, both recent hires from Deutsche Bank, to secure the loan, at terms that would value the property at roughly $1.45 billion – twice what it paid to buy the building three-and-a-half years ago. Fosun is seeking the debt for a term of between five to seven years, at a loan-to-value ratio of 55 percent.

CBRE’s Tom Traynor and James Millon (Credit: CBRE)

Representatives for Fosun could not be immediately reached for comment, nor could the brokers.

Bringing on a substantial amount of debt would be one of the final big moves in Fosun’s repositioning of the landmarked building, which it bought from JPMorgan Chase without any traditional debt on the property. The deal looked more like a capital-preservation play, rather than a traditional, leveraged real estate asset.

And when JPMorgan left, occupancy was below 50 percent.

But under the direction of Erik Horvat, the former director of the World Trade Center redevelopment at the Port Authority of New York and New Jersey who joined Fosun in 2014, the company received approval from the Landmarks Preservation Commission to create 200,000 square feet of retail at the base. And with a team at JLL led by Peter Riguardi and John Wheeler, the building inked some 700,000 square feet worth of leases and is now 72 percent occupied.

Leasing on the office side kicked off when Ironshore, an insurance company part-owned by Fosun, signed a lease for 100,000 square feet in 2015. Earlier this year, the New York State Attorney General’s office inked a deal for 345,000 square feet.

Fosun also signed the Alamo Drafthouse Cinema, which plans to open a 10-screen, 40,000-square-foot movie house, and inked a deal with restaurateur Danny Meyer to operate a catering and events space on the tower’s 60th floor.

Major refinancings this year include the $2.3 billion package led by Morgan Stanley at Boston Properties’ General Motors Building,  and the $1 billion package Deutsche Bank, Goldman Sachs and Morgan Stanley provided Crown Acquisitions to refinance the Olympic Tower at 641 Fifth Avenue and a handful of other retail and office buildings.

RXR Realty and David Werner secured $1.4 billion from Morgan Stanley in March to refinance 5 Times Square, and in February, Brookfield Property Partners landed a $550 million loan from Kiwoom Milestone US, an affiliate of investment adviser Civitas Altnerative Investments, to refinance 200 Liberty Street at Brookfield Place.

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