Elie Tahari Takes $70M Loan on 88 University Place to Make Way for WeWork
Richard Mack and Peter Sotoloff, the powers behind the new direct lending platform Mack Real Estate Credit Strategies, wrapped up their fourth big debt deal in the past few weeks.
The New York-based lenders provided a $70 million floating-rate loan on 88 University Place in Union Square, in a deal brokered by Mission Capital Advisors, to fund capital improvements on the 11-story office building, Commercial Observer can first report.
An investment group led by the fashion designer Elie Tahari purchased the 94,000-square-foot property between East 11th and East 12th Streets from Himmel + Meringoff Properties for $70 million in July, city records show. The 110-year-old office building contains 10 floors of loft office space and ground floor retail.
The new owners recently signed a lease with the shared workspace behemoth WeWork to occupy eight floors. WeWork (WE) is expected to eventually occupy all of the building’s office space, according to Mission Capital Managing Director Jonathan More, who worked on the debt deal
Prior to WeWork’s arrival, Mr. Tahari and his associates plan to use the proceeds from the MRECS loan to invest in new lobby entranceways, new elevator cabs, mechanical upgrades, HVAC upgrades and common area improvements.
“88 University Place is a rare blend of coveted loft space with terrific building bones in an exceptional location within Manhattan’s Greenwich Village,” said Mr. More, who helped arrange the financing alongside Mission Capital’s Ari Hirt and Jamie Matheny.
“This unique combination of property, locale and value-add afforded us the ability to secure very competitive capital and terms from a seasoned capital provider in Mack Real Estate,” the mortgage broker added.
Last month, MRECS tapped the New York fund manager Almanac Realty Investors to invest $262 million in equity for a new mortgage real estate investment trust known as Claros Mortgage Trust.
Messrs. Mack and Sotoloff recently closed a $200 million loan with Kuafu Properties for its purchase of 143-161 East 60th Street on the Upper East Side through the Claros mortgage REIT.
The lenders also provided a $51 million loan to Lincoln Property Company and Alcion Ventures for their conversion of a six–story warehouse at 1300 Flushing Avenue in Bushwick, Brooklyn, as CO first reported.
Messrs. Mack and Sotoloff were not immediately available for comment.