Harbor Group grabs $558M in financing for Black Rock purchase
Developer purchased former CBS headquarters for $760M
A huge office purchase requires huge financing, and Harbor Group International got it for its recent acquisition of Black Rock.
Two months ago HGI entered into an agreement to buy the office building at 51 West 52nd Street from ViacomCBS for $760 million. Now, the Commercial Observer reports that $558 million of that is coming from commercial mortgage-backed securities financing.
The six-year, floating-rate capital was provided by Deutsche Bank and Goldman Sachs, which combined on a $420 million senior mortgage. The other $138 million in the CMBS financing came from Brookfield Real Estate Finance in the mezzanine position. The deal will be executed as a single-asset, single-borrower transaction.
HGI bought the 38-story building for about $874 per square foot. ViacomCBS is leasing 817,000 square feet across 11 floors on a short-term basis, the Observer reports. The law firm Wachtell, Lipton, Rosen & Katz renewed its 250,000-square-foot lease in 2018.
The new owner of the building has grandiose plans. HGI is looking to use some of its debt to make capital improvements and re-tenant spaces where leases were not renewed. Some possible improvements previously reported include updates to the lobby, cafeteria and tenant amenities.
Black Rock was designed by architect Eero Saarinen, completed in 1965 and destined for landmark status. This is the first time the building has changed hands.
ViacomCBS initially announced plans to divest the skyscraper after the merger between Viacom and CBS. In early 2020, the media conglomerate was seeking to unload it for more than $1 billion, at least the third attempt to sell it. ViacomCBS pulled the building from the market after the pandemic began.
At the time the sale was announced, ViacomCBS CFO Naveen Chopra said proceeds would go towards growth opportunities, including the company’s streaming service, Paramount+.
[CO] — Holden Walter-Warner