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CMA
December 07, 2018  

Wells in Line to Finance Midtown Tower Deal

Wells Fargo has the inside track to originate a mortgage of about $400 million on One Dag Hammarskjold Plaza in Manhattan.

The loan would finance Rockpoint Group’s roughly $600 million acquisition of the 815,000-square-foot office tower from Ruben Cos. Rockpoint has given Wells the preliminary go-ahead. But details, including the exact proceeds, are still being hammered out.

The loan is expected to be a five-year floater. It’s unknown whether Wells would fully fund it or line up a few other lenders to take pieces.

New York-based Ruben marketed the property as a core investment with potential for revenue growth, mainly by raising rents as below-market leases roll over. Rockpoint, a Boston fund operator, struck an agreement three months ago to purchase the building and began talking to lenders. Cushman & Wakefield is advising on both the sale and the financing.

The 50-story building is one block from the headquarters of the United Nations. It encompasses 768,000 sf of offices and 47,000 sf of retail space, with parking for about 230 vehicles.

Designed by architect Emery Roth, it was developed in 1974 by Ruben, which has owned it ever since. Three years ago, Ruben finished a large-scale renovation that included upgrades to the ventilation systems, the two-story lobby and a public plaza.

The building stretches along Second Avenue from East 47th to East 48th Street, and has an alternate address of 885 Second Avenue. It’s currently 92% leased. Among the tenants are Population Council, Sloan Kettering Memorial Hospital, TeleRep and the U.N., as well as the delegations of numerous countries. About half the space is leased to tenants tied to the U.N.

The property offers views of the Midtown skyline to the west and the East River to the east.