Related Cos. JV to Secure $1.1B Refi in NYC
The transaction is slated to close at the end of this month.
Related Cos., together with GIC and affiliates of a Middle Eastern sovereign wealth fund, are set to secure a $1.1 billion refinancing loan for the office component of Deutsche Bank Center in Manhattan, according to Fitch Ratings. German American Capital Corp. and Wells Fargo Bank will co-originate the two-year, floating-rate note—with three one-year extension options.
The loan will be used to retire an existing $1.1 billion debt, as well as pay closing-related costs, which are estimated at $10 million. The transaction is expected to close on Oct. 29, 2025.
Related Cos. bought the majority interest in the office component at the Deutsche Bank Center in 2014, for $1.3 billion, according to Yardi Matrix information. For that transaction, the company secured a $675 million loan. After Time Warner sold the controlling interest, the property was rebranded, changing its name from Time Warner Center to Deutsche Bank Center.
Deutsche Bank Center’s trophy towers
Deutsche Bank Center is a 2.8 million-square-foot mixed-use complex developed by Related in 2003, after the designs of Chicago-based architecture firm Skidmore, Owings & Merrill.
The development features two 55-story office towers totaling 1.1 million rentable square feet, the 558,000-square-foot Shops at Columbus Circle, the 244-key Mandarin Oriental Hotel, 198 residential condos, the concert hall Jazz at Lincoln Center and a 504-spot subterranean parking garage. Related Cos. and Deutsche Bank have invested approximately $200 million, respectively $300 million in tenant improvements, buildout and mechanical upgrades over the years.
READ ALSO: Brookfield Nears $1.3B Manhattan Office Refi
The future loan will refinance the Class A towers at 1 and 60 Columbus Circle. The two office buildings house two long-term tenants, namely Deutsche Bank, which occupies 93.5 percent of the entire space and PDT Partners, which leases the remaining 6.5 percent. The property is currently fully leased. Deutsche Bank moved in its office space at the property in 2021, when the company signed a 20-year initial lease. Meanwhile, PDT Partners currently has 13.6 years remaining on its lease term.
July saw the national office vacancy rate clock in at 19.4 percent, unmoved over the past three months, but up 130 basis points year-over-year, according to the latest Yardi Matrix office report. Meanwhile, Manhattan’s figure dropped to 15.2 percent during the same month, marking a 130-basis-point decrease compared to July 2024. In-place rents across the U.S. stood at $32.72 per square foot, up 3.3 percent year-over-year, while the borough registered an average rate of $67.97 per square foot in July, down 4.7 percent year-over-year.
You must be logged in to post a comment.