JV Lands $500M Financing for Lower Manhattan Revamp

Nightingale Properties and Wafra Capital Partners will use the acquisition and construction loan to reposition an iconic 25-story tower.

111 Wall St. Rendering courtesy of Newmark

A partnership of Nightingale Properties and Wafra Capital Partners has landed a rare pandemic-era New York City office loan exceeding $500 million for the full-block 111 Wall St. tower in Lower Manhattan.

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Newmark arranged the acquisition and construction financing package, to be used for the renovation and repositioning of the 25-story, 1.2 million-square-foot building into a Class A office property. According to Commercial Observer, SKW Funding, PIMCO, Oaktree Capital and Bain Capital made up the lending consortium for the transaction.

In early 2020, the brokerage also secured a $145 million loan for the same joint venture’s purchase of the property’s ground lease. Nightingale and Wafra paid $175 million in a leasehold deal, which included a $100 million senior loan from SL Green Realty Corp. Later in May, SL Green sold the debt to Axos Bank, according to PincusCo Media.

The current debt includes $89 million in Commercial Property Assessed Clean Energy financing, provided by Petros PACE Finance LLC. The loan is the first deal to be completed under New York City’s recently launched C-PACE program and is the largest single C-PACE transaction since the financing structure’s debut more than a decade ago. The city passed the green financing enabling legislation in 2019, as part of the Climate Mobilization Act, Local Law 97, which requires landlords to cut carbon emissions by 40 percent by 2030.

The 1.1-acre waterfront site, situated between Wall Street and Gouverneur Lane, is adjacent to Wall Street Pier 11 and the Wall Street Helipad. The building was constructed in the 1960s, and its latest cosmetic renovation dates back to 2008, according to CommercialEdge.

Betting on Manhattan

STUDIOS Architecture will lead the overhaul efforts for the office space, while URBN Playground will oversee the design of a 40,000-square-foot tenant amenity space, located across the basement and ground floor. The building will also be outfitted with the latest touchless technology throughout.

The makeover will involve the installation of a new curtain wall with floor-to-ceiling View Smart Glass windows, while the lobby will also be reimagined. The complete infrastructure upgrade will comprise new MEP systems and a variable refrigerant flow HVAC system. LEED Silver acknowledgement is anticipated, while the building will also target Wiredscore Certification.

The property will feature three entrances with separate elevator access. Amenities are slated to encompass a 125-seat conference center, event space, a cafe and barista bar, other food and beverage options and a fitness center dubbed 111 WELL.

Newmark’s Vice Chairmen & Co-Heads of the New York Debt & Structured Finance team Dustin Stolly and Jordan Roeschlaub arranged the loan for the owners.

Despite the imminent reopening of offices, Manhattan’s commercial real estate market has been slow to get the ball rolling again. The half-a-million loan offers glimpses of hope in a substantially transformed business environment, that has yet to enter its recovery phase.

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