$372M in Financing for 1285 Avenue of the Americas

July 6, 2011
By Barbra Murray, Contributing Editor

The nearly 1.7-million-square-foot office high-rise at 1285 Avenue of the Americas has been refinanced to the tune of $372 million, courtesy of a deal orchestrated by commercial real estate and capital markets services firm Holliday Fenoglio Fowler L.P. HFF acted on behalf of the property’s owner, a joint venture involving AXA Equitable Life Insurance Co. and a group of institutional investors advised by J.P. Morgan Asset Management.

In 2001, AXA Equitable and the J.P. Morgan-led investors became partners in the ownership of 1285 Avenue of the Americas, which was developed in 1960. AXA Equitable–known as Equitable Life Assurance Society of the United States at the time–already owned 20 percent of the midtown Manhattan property when it joined forces with J.P. Morgan to acquire the remaining 80 percent share from Nippon Life Insurance Co. Located at Rockefeller Center, 1285 Avenue of the Americas carries the distinction of being the largest office building in all of New York to earn the U.S. Green Building Council LEED Silver certification, an accomplishment achieved in 2009.

HFF was able to bring MetLife Real Estate Investments onboard to provide the owners of 1285 Avenue of the Americas with a 10-year fixed-rate loan. The credit crunch has yet to fully loosen its tight grip, but financing has become more readily available for the right properties, and AXA and J.P. Morgan’s trophy asset is one such property.

A full tenant roster is usually an enticement for lenders, and 1285 Avenue of the Americas is 99.9 percent leased. The half-century-old tower, originally built to house the headquarters of The Equitable Life Assurance Society of the United States, counts global financial services company UBS, law firm Paul Weiss, Rifkind, Wharton & Garrison LLP and international advertising agency BBDO as its anchors.

Whatever the factors generally taken into consideration–location, quality, tenant roster, sponsorship–the lending community appears to be warming up to borrowers, particularly those owning quality properties in Manhattan. “A financing like the 1285 Avenue of the Americas deal demonstrates that there is adequate capital moving in major gateway markets like New York,” an industry expert told Commercial Property Executive.

SL Green Realty Corp. has been doing well with lenders. In April the REIT refinanced 3 Columbus Circle, a 770,000 square-foot office tower, with a $260-million mortgage loan provided by The Bank of China. That transaction was followed by the June announcement of the refinancing of 919 Third Ave., a 1.4-million-square-foot property the REIT owns with joint-venture partner New York State Teachers Retirement System, to the tune of $500 million through Metropolitan Life Insurance Co. and Pacific Life Insurance Co.

*This story was updated July 8, 2011 at 8:50 a.m. EST.