JPMorgan leads nearly US$1.2 billion financing for New York towers
JPMORGAN Chase and Tyko Capital, which is backed by Elliott Investment Management, have provided nearly US$1.2 billion in financing for luxury towers on Manhattan’s west side.
The lenders closed on the refinancing for One High Line, a pair of twisting towers that includes luxury condos and a hotel, according to the developers. JPMorgan provided a senior mortgage, while Tyko was behind the mezzanine financing.
The developers – Witkoff, Len Blavatnik’s Access Industries and Monroe Capital – bought the partially completed project out of foreclosure in late 2021. The refinancing was arranged by Walker & Dunlop.
Representatives for JPMorgan and Tyko declined to comment.
The deal is one of the largest financings backed by a single asset so far this year. Many lenders have shied away from providing large loans for real estate projects.
The High Line project in West Chelsea had a rocky past under previous ownership, with its initial developer HFZ Capital Group paying a record-setting price for the land in 2015 and then running out of money. Now, One High Line has secured more than US$800 million in sales.
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Demand for condos in New York has remained solid. In the second quarter, the median sale price was up 3.4 per cent from a year earlier to US$1.7 million, according to data from appraiser Miller Samuel and brokerage Douglas Elliman Real Estate.
Lenders today “want to back the best-in-class projects with best-in-class executions”, Alex Witkoff, co-chief executive officer at Witkoff, said in an interview.
The building has attracted many cash buyers so far, according to Witkoff. But if interest rates fall with potential cuts from the Federal Reserve, that could prove to be a boon, he said.
“Lower interest rates do benefit housing,” Witkoff said. “We’re quite bullish that not only will our pace of sales be sustained, but that it’ll even be picked up.” BLOOMBERG
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