As Wafra Capital Partners nears a deal to buy 720 West End Avenue, it’s getting a major assist in the form of acquisition financing.
The affiliate of Kuwait’s sovereign wealth fund is receiving $225 million in financing from Pacific Western Bank and Related Companies for the transaction, according to the Commercial Observer. PacWest is the senior leader in the financing, while Related is in the mezzanine position.
When Wafra — through entity WCP Investments — entered into contract to buy the 16-story building, the expected price tag was about $165 million. The Observer reported the deal has increased to $170 million and is expected to close on Dec. 23.
Brack Capital Real Estate put the building up for sale in June. The building is vacant and gutted, leaving a range of possibilities for its future. According to the Observer, a conversion to condos is one potential option for WCP; Brack Capital reportedly had plans for a series of condos and earned approval on plans from the Department of Buildings and the Landmarks Preservation Commission to convert and expand the property.
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A Cushman & Wakefield team including Adam Spies and Adam Doneger helped negotiate the sale of the building, while a Cushman & Wakefield team including Gideon Gil and Lauren Kaufman negotiated the financing.
Before Brack Capital purchased the building for $108 million, the Salvation Army utilized the property as a senior housing facility. The sale of the 352-unit development drew the attention of the state attorney general because of concerns over tenant protection laws. The Salvation Army ultimately agreed to pay moving expenses and pass on potential rent increases at a new housing site for the first 18 months.
Earlier this year, Wafra partnered with Nightingale Properties to buy the land underneath 111 Wall Street for $220 million. Previously, the joint venture acquired the leasehold interest of the 24-story office property for $175 million. The joint venture also secured $500 million in debt to redevelop the property.
[CO] — Holden Walter-Warner