In a transaction that is scheduled to close later this month, Tishman Speyer and Henry Crown are set to refinance The Spiral with a nearly $2.9B loan package set to be one of the biggest CMBS deals in recent years.
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That package consists of a $2.65B CMBS loan and $200M of nontrust companion notes, according to a report by Fitch Ratings obtained by Bisnow. The debt would mature in 2030 and is a fixed-rate, interest-only loan.
The loan proceeds will be used to refinance $1.6B of prior debt, made up of approximately $1.4B of construction financing and $216M of EB-5 debt. It will also fund more than $220M in upfront reserves for ongoing obligations and about $75M in closing costs.
The $2.65B bond sale was first reported by Bloomberg.
Tishman and Crown will cash out approximately $967.2M in equity, according to a DBRS Morningstar report. Even after pocketing nearly $1B in the deal, the owners still have an estimated $740M of equity in the building, which cost $3.6B to build.
Tishman declined to comment. The loan is expected to be co-originated by JPMorgan Chase, Goldman Sachs Bank, Bank of America and Wells Fargo Bank. The deal is expected to close Jan. 24
The debt is backed by The Spiral, a 66-story trophy office tower across the street from the Hudson Yards megaproject. Just 174K SF of the 2.8M SF building, which delivered in 2023, is vacant. Pfizer, AllianceBernstein and Debevoise & Plimpton all have their headquarters at the building, alongside HSBC's U.S. headquarters.
In October, Tishman refinanced Rockefeller Center with a $3.5B CMBS loan — the largest issuance ever for a single office asset. If The Spiral deal closes as expected, it would mean the New York developer scored more than $6B in financing in a matter of months — all tied to office assets.
It also comes as the CMBS market has heated up. A S&P Global Ratings report projected that $90B of securitized CRE loans would be issued in 2024, after $74B of CMBS debt was issued in the first nine months of the year. Just $40B was issued in all of 2023, according to Trepp.
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