The Real Deal New York

Victor Group lands $30M condo inventory loan for the Getty

Paragon Outcomes and Axos Bank provided the loan
By Meenal Vamburkar | February 06, 2019 06:30PM

Moshe Shuster and the Getty

Victor Group snagged a $30 million condo inventory loan for the remaining unsold units at the Getty building in West Chelsea.

Investment firm Paragon Outcomes Management and Axos Bank – formerly known as Bank of Internet – provided the loan, according to a Paragon statement Wednesday. The loan for the project at 501 West 24th Street closed in January.

To date, three of the seven units at Victor Group and Michael Shvo’s project have sold, Paragon said. As the new development condo market has struggled amid the market slowdown, developers who landed construction loans three or four years ago have been revising their finances in an effort to adapt. Increasingly, they’ve turned to condo inventory loans, which use unsold units as collateral and can replace more expensive mezzanine financing.

Last month, Tom Hill, the Blackstone Group billionaire, closed on a $29 million commercial condo at the Peter Marino-designed Getty. The unit, spanning the third and fourth floors, will house his renowned art collection.

The 12-story luxury building also snagged the priciest Downtown Manhattan sale with billionaire Robert Smith’s $59 million deal for the triplex last year. Following the sale, the developer decided to increase prices for the remaining apartments. The fifth-floor apartment, for example, was originally priced at $16 million and then increased to $19.5 million. And the seven-floor unit increased from $17.5 million to $21 million. The new asking prices brought the total project sellout of the residential portion to $138 million.

In April 2018, the Lehmann Maupin gallery paid $27 million, or about $4,400 per foot, for the gallery space on the building’s first and second floors.

The Getty is the second Victor Group project Paragon has financed. It previously provided a land acquisition and predevelopment loan for the 277 Fifth Avenue condo project.

A spokesperson for Victor Group declined to comment.