Developers of Palace Theatre redevelopment seeking $1B-plus in financing

$2.4B project to feature 110K sf of new retail and overhauled hotel and theater 

New York /
Jan.January 12, 2018 05:20 PM

From left: Renderings of 1568 Broadway, Robert Lapidus and and Michael Tepedino

UPDATED, Jan. 13, 1:45 p.m.: Maefield Development, Fortress Investment Group and L&L Holding Company are looking for a $1.3 billion construction loan for their redevelopment of the Palace Theatre in Times Square, The Real Deal has learned.

The developers have hired HFF to find an investment partner and construction lender for a funding boost to their project at 1568 Broadway, dubbed TSX Broadway, L&L confirmed Friday. They’re also looking for an investment partner to contribute $500 million toward the project’s $1.1 billion worth of equity.

The $2.4 billion project would result in the elevation of the historic Broadway theater, the expansion of the hotel, and the creation of new retail and LED signage on the façade of 1568 Broadway.

“We’re going to have the only operating stage overlooking Times Square, as well as the best signage possible,” said Robert Lapidus, president of L&L. “This project is really about 21st century brands trying to connect with customers.”

An HFF team led by Michael Tepedino and Michael Gigliotti is handling the financing. The brokers declined to comment, and neither Maefield nor Fortress could be reached.

Plans call for the expansion into a 47-story, 550,000-square-foot property with 663 hotel rooms, 110,000 square feet of retail, and a 17,000-square-foot sign. The firms plan to begin construction by late summer and complete the project by the end of 2021, Lapidus said.

The building, located at the corner of West 47th Street, currently houses a 468-room DoubleTree Suites by Hilton Hotel along with the theater.

The undertaking has been in the works for some time. Landmarks Preservation Commission approved the overhaul of the Palace Theater in 2015.

L&L Holding joined as an equity partner and co-developer in July, when the firms paid $200 million for the remaining interest in the hotel portion. Maefield had acquired a leasehold stake in the property for $540 million in 2015.

Developers Steve Witkoff and Michael Ashner’s new investment fund recently bought a piece of a $75 million mezzanine loan tied to the project, of which JPMorgan is the lead lender. Maefield and its partners are also seeking EB-5 funding for the project.

Correction: A previous version of this story misidentified the components of the financing package sought for the redevelopment of 1568 Broadway.


Related Articles

arrow_forward_ios
NYC’s office sublease surge slows as tenants move to reoccupy space
NYC’s office sublease surge slows as tenants move to reoccupy space
NYC’s office sublease surge slows as tenants move to reoccupy space
The Roger New York hotel at 131 Madison Avenue, Larry Korman of AKA Hotel Residences and Joe Lubeck of Electra America (Google Maps, Getty, Electra)
Electra America JV nabs Roger hotel for $71M discount
Electra America JV nabs Roger hotel for $71M discount
Oceanwide’s US business is sinking. Can it right the ship?
Oceanwide’s US business is sinking. Can it right the ship?
Oceanwide’s US business is sinking. Can it right the ship?
Demir Sabanci and 41-47 West 57th Street (Sedesco, Google Maps)
Sedesco seeks rezoning for new Billionaires’ Row skyscraper
Sedesco seeks rezoning for new Billionaires’ Row skyscraper
From left: Alvin Dworman, 155 East 55th Street, 65 West 55th Street, and 210 East 58th Street (Getty, Google Maps)
Alvin Dworman Sells 3 Manhattan Buildings for $65M
Alvin Dworman Sells 3 Manhattan Buildings for $65M
Anita Durst and images of Chashama (Photos via Getty, Chashama)
Durst-backed nonprofit puts startups into empty storefronts
Durst-backed nonprofit puts startups into empty storefronts
Berkshire Bank headquarters in 4 East 39th Street (Google Maps)
Major FiDi landlord resigns as bank chairman after stock windfall
Major FiDi landlord resigns as bank chairman after stock windfall
Nationally, just under one-third of office workers have returned to the office spaces they occupied before the pandemic. (iStock)
Employers face uphill battle luring staff back to the office
Employers face uphill battle luring staff back to the office
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...