Brookfield mulling $700M equity injection into 666 Fifth Avenue: report

The company has not yet finalized its reported deal to buy Vornado's 49.5 percent stake in the tower

TRD New York /
Jun.June 15, 2018 12:18 PM

Ric Clark and 666 Fifth Avenue (Credit: Curbed NY)

Brookfield Property Partners is considering a $700 million equity injection at 666 Fifth Avenue, where it already plans on acquiring a 49.5 percent ownership stake from Kushner Companies.

It’s also looking to bring in a new $1 billion loan on the property, according to Commercial Mortgage Alert.

The new capital would be used to update the aging office tower as well as pay off the building’s existing $1.4 billion in debt, which comes due in February. Kushner Companies, which would still own 50.5 percent of the building, would not put up any additional capital on its own, CMA reported.

It’s not clear if the massive equity contribution by Brookfield would up its ownership in the tower. A source who spoke to CMA said the property’s current valuation was somewhere between $1.2 and $1.3 billion.

Vornado Realty Trust originally purchased the 49.5 percent stake in 666 Fifth Avenue in 2011 and this year announced it would sell it back to Kushner Companies generating “net proceeds” of $120 million. Brookfield, in turn, is expected to buy that stake from Kushner.

“We think the strategy for that building to enhance value is right up our alley, it’s something that we’ve done multiple times,” Brookfield’s Ric Clark said at the Catalyst real estate conference last month.

Earlier this month, The Real Deal published an exclusive interview with Charles Kushner in which he discussed his abandoned plans that would have transformed the trophy property into a 1,400-foot luxury condominium, hotel and retail complex. “The old plan – we did scrap – which the press has reported as crazy or unattainable – our logic, it was not a crazy logic at all,” Kushner said. “We had term sheets signed for several billion dollars of equity, but it’s such a big project and would require so much sovereign funds that it’s just not something that we can execute without creating a lot of havoc.” [CMA] — Will Parker


Related Articles

arrow_forward_ios
An aerial view of a pop-up drive-in theater built in the parking lot at the Broadway Commons in Hicksville, New York (Getty)

Covid pummeled shopping centers, but their parking lots are thriving

Covid pummeled shopping centers, but their parking lots are thriving
20 West 33rd Street (20West33rd)

Furnishing firm picks up 4 condos at 60 Guilders, Carlyle’s Midtown South project

Furnishing firm picks up 4 condos at 60 Guilders, Carlyle’s Midtown South project
Bank OZK CEO George Gleason (Unsplash; Bank OZK)

Bank OZK’s lending up in third quarter

Bank OZK’s lending up in third quarter
Gap CEO Sonia Syngal (Getty)

Gap Inc. will close 350 stores and exit malls entirely

Gap Inc. will close 350 stores and exit malls entirely
Steve Cohen and Citi Field (Getty)

Citi Field lease clause could stymie billionaire’s quest for the Mets

Citi Field lease clause could stymie billionaire’s quest for the Mets
Consumers are using streaming services more than ever, and data center real estate is booming (iStock)

Real estate for data centers is having a moment

Real estate for data centers is having a moment
Paul Manafort and Manhattan district attorney Cyrus Vance, Jr. (Getty)

Manafort mortgage-fraud case dismissed, again

Manafort mortgage-fraud case dismissed, again
Howard Hughes’ Saul Scherl and a rendering of 250 Water Street (Getty, The Howard Hughes Corporation/SOM)

Howard Hughes to launch review process for $1.4B Seaport tower

Howard Hughes to launch review process for $1.4B Seaport tower
arrow_forward_ios

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

Loading...