Northwind Group Lends $75M on Office-to-Resi Conversion of Former Pfizer HQ
By Andrew Coen August 21, 2024 4:47 pm
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A joint venture between Nathan Berman’s Metro Loft Management and David Werner Real Estate Investments has secured $75 million of acquisition financing to develop New York City’s largest office-to-residential conversion project at the former Pfizer headquarters building in Midtown Manhattan, Commercial Observer can first report.
Northwind Group provided the senior acquisition predevelopment loan on the sponsorship’s 219 East 42nd Street property, which was formerly the global headquarters of Pfizer before the pharmaceutical giant relocated to Tishman Speyer’s Spiral office tower at Hudson Yards in late 2022.
Metro Loft and Werner are also planning to convert the adjacent office property at 235 East 42nd Street into residential housing for 1,500 combined rental units, which would surpass Metro Loft’s 1,300 units planned at 25 Water Street in Lower Manhattan, The Real Deal reported in March.
“This office building, located in the heart of Midtown East, is fully vacated and primed for an as-of-right conversion, which will be part of the largest office to residential conversion in NYC history,” Ran Eliasaf, founder and managing partner of Northwind Group, said in a statement. “The attractive basis and top-tier sponsorship with deep experience and a clear executable business plan fit well within our debt fund’s investment thesis.”
IPA Capital Markets’ Max Herzog arranged the financing.
The conversion of the nine-story 219 East 42nd property will involve developing a 29-story residential tower with up to 660 apartments, according to Northwind.
Werner acquired interests in both 219 East 42nd and 235 East 42nd in 2018 for $355 million from Alexandria Real Estate Equities with Berman inking a contract early this year for a minority 50 percent stake, according to TRD. The purchase price details from the Metro Loft deal were not immediately available.
Berman said in a statement called Werner an “industry leader” and he is confident the project “will be another successful conversion of antiquated office space into modern residences.”
Werner said in a statement that the firm is “honored to own this asset and work on this project together with Metroloft.”
Andrew Coen can be reached at acoen@commercialobserver.com
