Greg Kraut’s KPG Funds secured $63.6 million in new debt for its efforts to turn around a formerly vacant Soho office building.
Senior lender Ladder Capital teamed up with Heitman to provide the debt package to refinance 446 Broadway, also known as L’Atelier, Commercial Observer first reported.
Since acquiring the five-story office and retail property in 2018 for $45 million, KPG has spent more than $10 million on renovations, including updates to the building’s lobby, elevators, windows and facade, according to the publication.
Cabin Editing Company, a Los Angeles-based production company, signed a lease for the building’s top floor in July. The Orb, a tech startup, leased a different floor in the building in September.
Only the third floor remains available for lease, according to the building’s website.
A Newmark team led by Dustin Stolly and Jordan Roeschlaub arranged the financing.
KPG went into contract to buy the 37,000-square-foot building in May 2018 for $45 million, months after it hit the market for $58 million. Architect John Butler Snook designed the building, which was completed in 1877.
Last year, KPG picked up two money-losing retail properties from Vornado Realty Trust at 155 Spring Street and 478-482 Broadway, both of which are destined to become office buildings. KPG paid approximately $85 million for the properties, sources said at the time.
KPG launched a $200 million fund in 2020 to buy small Class B and Class C office properties and redevelop them into Class A offices. The firm was targeting properties with prices ranging from $85 million to $300 million.
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Office developer is buyer of Vornado’s Soho buildings
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[CO] — Holden Walter-Warner