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New York

Tishman Speyer, Silverstein land $300M refi on Midtown office tower

Deal comes through despite challenges in funding environment

From left: Tishman Speyer's Randall Rothschild and Silverstein Properties' Larry Silverstein along with 11 West 42nd Street (Getty, Tishman Speyer, Google Maps)

From left: Tishman Speyer’s Randall Rothschild and Silverstein Properties’ Larry Silverstein along with 11 West 42nd Street (Getty, Tishman Speyer, Google Maps)

Tishman Speyer and Silverstein Properties scored a $330 million refinancing deal on a Midtown office tower.

Bank of America is the primary lender, with Taconic Capital taking the mezzanine debt at 11 West 42nd Street near Bryant Park, the companies announced on Wednesday.

It’s a five-year, fixed rate loan that will replace existing debt and will be used in part to fund the building’s leasing program.

The Class A office tower is 99 percent leased after securing 321,000 square feet of new leases and expansions over the last two years, according to metrics provided by the companies. The building totals 32 stories and 960,000 square feet.

The deal is notable given the struggles facing New York offices and their efforts to get financing, inflicted in part by high interest rates.

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Available office space in Manhattan hit a new all-time high in the second quarter of 2023, with 70.3 million square feet empty, according to the most recent report from Savills. That represents 19.7 percent of all Manhattan office space, which is the highest since the onset of the pandemic.

Leasing activity is also slow, with new leases falling by 12.1 percent in the first half of this year compared to the same time period last year. 

The struggles are not plaguing the sector equally. Class A buildings are much healthier than Class B and C buildings, and Midtown offices are faring considerably better than other parts of Manhattan, most notably the Financial District.

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Some of the tenants at the Midtown building owned by Tishman and Silverstein include Michael Kors, Citizen’s Bank and Trust, New York University, and Kohn Pederson Fox.

The building owners were represented by a Newmark team led by Dustin Stolly, Jordan Roeschlaub, Nick Scribani, Chris Kramer, Issa Abbassi, and Holden Witkoff.

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Bryant ParkMidtown