The Brill Building, once a headquarters for America's pop music industry, has a new headliner: Brookfield Properties.
Brookfield took control of the 11-floor, 175K SF building at 1619 Broadway in Midtown after foreclosing on a mezzanine loan it held against the property that defaulted in recent months, Crain's New York Business reports.
Real estate investors Brickman & Associates and Allied Partners bought the building for $185.5M in 2013. They sold stakes to other partners, including Conway Capital, last summer in a deal valuing the building at $310M, a 70% jump. As part of that transaction, the partners also took on additional debt.
Before that sale, the joint venture embarked on a $25M, top-to-bottom reposition that overhauled the building’s interior and infrastructure and added a glass façade for ground-floor retail.
Brookfield executed the takeover after Brickman and Allied failed to lease the roughly 40K SF of retail to make enough for their investment to pay off.
"We made an investment four years ago that was predicated on certain retail rents, and instead those rents dropped tremendously," Brickman chief investment officer Steven Friedman told Crain's, "and we couldn't generate the cash flow we expected."
