The Real Deal New York

Natixis-led group provides $2B to finance Maefield’s 20 Times Sq. deal

Developer closing imminently on massive buyout of partners at mixed-use project
By Mark Maurer | April 30, 2018 04:00PM

Mark Siffin and a rendering of 20 Times Square (Credit: Arx Solutions)

UPDATED, April 30, 5:58 p.m.: Mark Siffin’s Maefield Development closed Monday on the massive buyout of its partners in the hotel-and-retail project known as 20 Times Square, The Real Deal has learned. The deal values the property at $1.53 billion.

A group of lenders led by French bank Natixis provided about $2 billion in acquisition financing and refinancing for the property, which has the street address of 701 Seventh Avenue, said sources familiar with the deal. Maefield signed a contract in February to buy out a large group of partners including Steve Witkoff, Michael Ashner’s Winthrop Realty Trust, Howard Lorber’s New Valley and the Carlton Group’s Howard Michaels, as TRD first reported.

The complex is slated to hold a 39-story tower containing a 452-key Marriott Edition hotel, 76,000 square feet of retail and a 17,000-square-foot LED billboard sign, and the development is almost complete. The NFL Experience and Hershey’s Chocolate World stores have already opened, while the hotel is expected to be ready this summer.

Representatives for Maefield, Fortress, Natixis and the partners being bought out declined to comment.

Debtwire first reported on the identity of the lender, but did not disclose the amount.

Fortress, which previously held equity in the project, now holds just a debt position, sources said. Fortress, along with L&L Holding Company, is an equity partner at Maefield’s project across the street at 1568 Broadway. That project, called TSX Broadway, is the redevelopment of the Palace Theatre and a hotel into a 47-story, 550,000-square-foot tower with 110,000 square feet of retail.

The investor group paid $430 million in 2012 for the site, then home to an 11-story office building. They announced plans for a hotel that same year and broke ground in 2015, but continued to face development delays.

According to Winthrop’s February filing with the U.S. Securities and Exchange Commission, “the purchase and sale agreement provides that upon closing, a portion of the proceeds in excess of the amount that would return to the Trust its capital investment plus a 12% return thereon is to be placed in escrow pending completion of the development of the Property.”

The deal joins Google’s all-cash $2.4 billion Chelsea Market building purchase as the city’s only other $1 billion-plus investment-sales deal so far this year. There are other deals in contract north of the $1 billion amount, including Silverstein Properties’ deal to buy ABC’s West Side headquarters.

Siffin, Maefield’s CEO, has been involved in the 20 Times Square project since 2010, when he began seeking to raise capital to acquire the 11-story office-and-retail building on the site. The project would mark the 67-year-old developer’s first completed undertaking in New York.