Finance  ·  CMBS

601W Companies Closes on Acquisition of 410 Tenth Avenue, Lands $705M CMBS Loan

JP Morgan provided the seven-year debt


The 601W Companies has officially closed on its acquisition of 410 Tenth Avenue, along with the $705 million commercial mortgage-backed securities (CMBS) loan it secured for the purchase, sources close to the deal told Commercial Observer. 

The transaction closed late Friday afternoon. 

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J.P. Morgan provided the seven-year, fixed-rate debt. Commercial Mortgage Alert first reported details of the financing. 

The 20-story, Class A office redevelopment project comprises 636,000 square feet. Its major tenants include Amazon (AMZN), which anchors the property and leases 335,000 square feet, and First Republic Bank (FRCB), which occupies 212,000 square feet. 

In November, SL Green (SLG) Realty Corp. announced it had agreed to sell the property to 601W Companies for $953 million, with the disposition being heralded as the biggest office sale in the country since the onset of the coronavirus pandemic.

As part of the deal, 601W is taking over the $600 million construction loan SL Green closed in September for the property with lenders Goldman Sachs (GS) and Wells Fargo (WFC), The Real Deal reported.

The REIT bought the building in 2018 from the Kaufman Organization for $440 million. 

“The sale of 410 Tenth Avenue is yet another indication of the Manhattan office market’s resiliency and continued global demand for high-quality, trophy assets with credit-rated tenants,” Brett Herschenfeld, managing director of SL Green, said in a statement at the time the sale was first announced. “While the asset was always intended to be held as a long-term investment, the sale will allow the company to achieve extraordinary profits, substantially reduce consolidated indebtedness, and generate additional liquidity for share repurchases.”

CBRE (CBRE)’s Darcy Stacom brokered the sale, while Meridian Capital Group negotiated the loan, sources said. 

The debt deal marks the second behemoth CMBS financing to close in a week. On Dec. 11, KKR (KKR) sealed a $740 million acquisition loan for its $835 million purchase of an industrial portfolio from High Street Logistics Properties. Barclays (BCS) provided the debt, as first reported by CO.