$800M Manhattan Tower Loan Goes to Special Servicing

October 17, 2025

Office Finance New York News More Northeast

A REIT and a major private investor own the 27-story building.

Exterior shot of the office and retail building at 650 Madison Ave. in Manhattan — The tower at 650 Madison Ave. has floorplates ranging from 10,700 to 44,500 square feet. *Image courtesy of Yardi Matrix*

The $800 million CMBS loan against 650 Madison Ave., a 27-story, 595,000-square-foot office and retail building in Manhattan owned by Vornado Realty Trust and Oxford Properties Group, has been sent to a special servicer. The borrower missed a payment and requested the transfer citing imminent default.

The single-asset, single-borrower CMBS loan’s most recent status is 30 days delinquent, according to a Trepp trading alert. Trepp stated the loan was transferred to special servicing due to a waterfall shortfall not being funded by the borrower. A pre-negotiation agreement has been executed with the borrower and guarantor but no decisions have been made and the loan remains under active review. The special servicer is Green Loan Services LLC, a subsidiary of SL Green, Bisnow reported.

“The net cash flow in the first half of 2025 was insufficient to fully cover the loan and we’ll be watching closely for the next round of financials,” a Trepp spokesperson told Commercial Property Executive.

The joint venture of Vornado and Oxford, the real estate arm of the Ontario Municipal Employees Retirement System, acquired the asset in October 2013 from Ashkenazy Acquisition Corp. and The Carlyle Group for approximately $1.3 billion.

The owners completed an $800 million refinancing in December 2019 with a 10-year interest-only loan featuring a fixed-rate of 3.486 percent. The refinancing replaced an $800 million loan that bore a fixed rate of 4.39 percent and was scheduled to mature in October 2020, Yardi Matrix data shows. The CMBS loan was originated by Citi, Barclays, Goldman Sachs and BMO Harris Bank.

Revenue and value down

Since the 2019 refinancing, revenue and occupancy have fallen at the LEED Gold-certified property located between 59th and 60th streets in the Plaza District. A new appraisal this month also showed the property’s value dropped from about $1.2 billion to $950 million, according to Bisnow.

Completed in two phases, in 1957 and 1987, the tower comprises 90,000 square feet of retail space across its first two floors, according to Yardi Matrix. The building has floorplates ranging from 10,700 to 44,500 square feet.

In January, Ralph Lauren, previously the property’s largest office tenant, downsized its global headquarters from 133,000 square feet to 86,000 square feet. The luxury goods retailer is now paying 30 percent less in rent, according to media reports. Occupancy has dropped from 82 percent at the end of 2024 to 74 percent in June. When the building was refinanced in 2019, the occupancy was 97 percent.

Other office tenants at the building include BC Partners Inc., Willett Advisors LLC, Sotheby’s International Realty Inc., Spring Mountain Capital and Lakeview Capital Management. The property also has retail on the first and second floors. Retail tenants include Cremieux, Tod’s, Celine, Balmain, Moncler and Roger Vivier.

Last month, Vornado completed the $218 million acquisition of another Plaza District office tower—623 Fifth Ave.—from Cohen Brothers Realty, which had owned the office condominium property adjacent to Rockefeller Center since 2022. Other Vornado holdings nearby include 280 Park Ave., 350 Park Ave., 640 Fifth Ave., 595 Madison Ave. and 1290 Avenue of the Americas.