Triangle Seeks Loans on 2 Midtown Offices
A New York investor is in the market for $200 million of debt on two office properties in Midtown Manhattan.
Triangle Assets is seeking a $110 million mortgage on the 154,000-square-foot building at 369 Lexington Avenue and a $90 million mortgage on the 152,000-sf building at Two West 46th Street. The preference is for floating-rate loans that would run for five years. Newmark is advising Triangle on the refinancings.
Both buildings are within a few blocks of Grand Central Terminal. The Lexington Avenue property, at East 41st Street, is 93% occupied. The other, just off Fifth Avenue, is about 96% leased. Both have ground-floor retail space.
Proceeds from the proposed loans would go toward retiring existing debt originated in 2013 by Starwood Property. The Greenwich, Conn., REIT provided a $61.6 million mortgage on 369 Lexington Avenue and securitized the $43.1 million senior portion in a $1.2 billion commercial MBS offering (JPMBB 2013-C15). It wrote a $43.5 million loan on Two West 46th Street and placed the senior $30.5 million component in the same conduit deal. The senior loans, with coupons of 5.05%, had 10-year terms — so Triangle would have to use defeasance to release the properties.
Triangle is controlled by members of the Stavrach family. Through affiliates, it bought 369 Lexington Avenue from New York investor Harry Macklowe in 2004 for $46 million. Since then, the building has undergone some $30 million of improvements, including new elevators and building systems, a facade upgrade and renovations to the lobby.
Net operating income rose to nearly $6 million last year, up from $4.6 million in 2013, according to servicer reports. The property’s value was recently boosted by zoning changes that allow for expansion to roughly double its current size.
A Triangle affiliate acquired Two West 46th Street in 2006 from Belgo African Diamonds. It paid $53.5 million, and subsequently spent as much as $20 million on renovations that closely matched the improvements at the Lexington Avenue building. Net operating income reached $4.7 million last year, up from $3.4 million in 2013.