Since CMBS markets came back to life towards the end of 2020, Brookfield has been on a roll with a series of massive single-asset refinancings, locking in the largest Manhattan real estate loans for three of the past four months.
The latest was a $835 million refinancing of One New York Plaza, originated by Wells Fargo, Goldman Sachs and BMO Harris Bank. The 50-story office building is situated at Manhattan’s southern tip in the Financial District.
The refinancing was securitized in a CMBS transaction named ONYP 2020-1NYP, and documents associated with the deal provide an up-to-date, in-depth look at the building’s finances.
The 2.6 million-square-foot tower is currently 96.5 percent leased to 26 tenants with an average rent of $53 per square foot, according to loan documents.
Morgan Stanley, which first became a subtenant at the building in 2005 and a direct tenant in 2012, now occupies more than half of its rentable area. The investment bank is currently renovating its space, and plans to give back floors 32 and 36 this year in a slight downsizing. To facilitate the renovation, the firm has signed short-term leases on the 31st and 33rd floors to “swing personnel in and out fluidly” as needed.
Other major tenants at One New York Plaza include international law firm Fried Frank, British publisher Macmillan, plus-size apparel company FullBeauty and cosmetics producer Revlon. The building’s 39,000 square feet of retail space is leased to tenants like Starbucks, Chop’t, Retro Fitness and Chipotle, with base rent for retail leases signed since 2015 averaging $62 per square foot.
Due to the impact of the coronavirus pandemic, retail rent collections at the property stood at just 17 percent as of November. The parking operator, which is affiliated with Icon Parking, has not paid rent for months and is being evicted, after which the landlord expects to transition from a lease to a management agreement. Office rent collections, meanwhile, stood at 95 percent in November.
Brookfield acquired One New York Plaza in 2006 as part of its acquisition of Trizec Properties. In 2016, it sold a 49 percent stake to Chinese sovereign fund China Investment Corporation, and a 16 percent stake to AEW Capital Management. It retains a 35 percent stake and continues to manage the building.
Since 2012, the landlord has invested more than $230 million into the property, including a reconstruction of the retail concourse, facade repairs and flex office space build-out. The building has also seen almost 1.4 million square feet in leasing activity in the past five years, after the departure of former anchor tenants Goldman Sachs and Wachovia Bank in 2013 and 2014, respectively.