RXR, Werner Score $1.4B Refi of 5 Times Square [Updated]


Morgan Stanley has provided a $1.4 billion refinancing to RXR Realty and David Werner for their 5 Times Square office building which spans West 41st to West 42nd Streets on Seventh Avenue, sources have confirmed to Commercial Observer.

The debt package consists of a $782 million senior mortgage, a $200 million junior mezzanine loan from SL Green Realty Corp. and roughly $418 million in other mezzanine financing, according to one of the sources, who spoke on the condition of anonymity. The senior loan, which carries a five-year term, appears in city records, while the mezzanine debt does not. There were no brokers involved in the transaction.

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Morgan Stanley will hold the senior financing on its balance sheet, and is in the process of syndicating out the subordinate pieces. It replaces a total of $1.39 billion debt on the building that was securitized across two commercial mortgage-backed securities transactions, WBCMT 2007-C30 and WBCMT 2007-C31, in March 2007, according to data from Trepp. That financing matured earlier this month.

RXR purchased a 50 percent interest in the 39-story tower in January 2016, at the time valuing the property at $1.6 billion, as has been widely reported. Ernst & Young, or EY, occupies more than 90 percent of the 1.2-million-square-foot building. Red Lobster is at the base of the property. 

Morgan Stanley has provided a number of similar-sized financings to RXR. In May 2016, the financial institution teamed up with AIG to provide RXR and Werner with a $1.2 billion loan for the purchase of 1285 Avenue of the Americas, which was one of the largest debt deals last year. In November 2014, Morgan Stanley funded RXR’s purchase of a stake in 530 Fifth Avenue with a $200 million loan, as CO reported at the time.

Representatives for Morgan Stanley and RXR did not immediately respond to requests for comment. An individual who answered the phone at the office of Werner hung up when asked for comment.

Update: This story has been updated to include further details about the mezzanine debt provided on 5 Times Square.