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New York, New York: Formerly Defaulted Loan Refinances; Office Loan Defeases; Downtown Office on the Block

April data show that the $133 million Three Borough Pool paid off with a small loss. A Wall Street Journal article and a Barclay’s note also alerted us to the refinancing of the previously delinquent loan backed by 42 multifamily buildings across Manhattan, Brooklyn and The Bronx. New York Attorney General Eric Schneiderman and the owners of the pool, Normandy Real Estate and Westbrook Partners, came to a settlement which allowed the refinancing to be finalized.

The loan had been delinquent since 2011 when conversions to market rent were slower than anticipated. An appraisal from early 2013 pegged the pool at $185.9 million, actually up from its securitization value of $158.4 million.

April remittance data show a loss of $0.8 million on the loan after paying back servicer advances and interest shortfalls. Three Borough Pool had backed 5% of WBCMT 2007-C33 and 27% of the multifamily directed A-1A tranche which was paid down by that amount this month.

Normandy Real Estate Partners is making another move in Manhattan according to a Credit Suisse note. Normandy is reportedly looking to buy 65 Broadway on behalf of an Asian buyer. The 342,278 square foot building in downtown Manhattan backs a $66.5 million loan that accounts for 7% of CSFB 2005-C2. Apparently the building was put up for sale in December with an estimated sale price between $120 million and $137 million according to the CS piece. The 2005 loan is due to mature in February of next year and is locked out until this coming November.

Separately, another large New York City loan refinancing will lead to a defeasance, in this case for the $193.8 million 909 Third Avenue loan. According to a report in CRE Direct, Vornado has borrowed $350 million on the midtown office building. Through the first three quarters of 2013, the 1.3 million square foot office was 99% occupied and generated $13.9 million in NOI ($18.5 annualized). The loan had collateralized 19% of LBUBS 2005-C2 and was due to mature in April of next year. The note is locked out for another six months. | ©1997-2013 Trepp, LLC. All Rights Reserved.