Kushner refinances 666 Fifth Avenue


From left: Jared Kushner of Kushner Companies, Vornado’s Steven Roth and 666 Fifth Avenue

Jared Kushner’s Kushner Companies has completed a refinancing of its mammoth tower at 666 Fifth Avenue with Vornado Realty Trust, Bloomberg News reported. Vornado is injecting $80 million of equity into the project in return for a 49.5 percent stake in the tower, while Kushner will also contribute $30 million to the refinancing.

Under the agreement, the tower’s senior debt will be reduced to $1.1 billion from almost $1.22 billion, a source with knowledge of the deal told Bloomberg. The equity contributions will cover the costs of leasing the 30 percent of the building that’s currently vacant, the source said.

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In the spring of 2010, Kushner asked that the $1.2 billion in securitized loans on the 1.5 million-square-foot building, which he bought for a record $1.8 billion in 2007, be put into special servicing with LNR Partners, so that the debt could be restructured.

The office portion of the tower began encountering problems after multiple tenants failed to renew leases after the crash. Kushner funded the shortfall on monthly debt payments out of a reserve account but that account ran dry in June, according to news reports, leaving Kushner open to default. The building was 90-plus days delinquent on a loan with an outstanding balance of $929.5 million in November, according to the most recent distressed property data from real estate analytics firm Trepp provided to The Real Deal. [Bloomberg News]