A group of investors led by Jeff Sutton refinanced a Times Square retail property occupied by Duane Reade with a $60 million loan from Bank of China.
The bank is replacing a $60 million note securitized by Wells Fargo on the property at 661 Eighth Avenue that was set to mature on Jan. 11, the Commercial Observer reported. That loan carried an interest rate of roughly 5.9 percent. The new loan has a three-year term with a Libor-based floating rate that currently sits at 3 percent.
The 17,667-square-foot property, which Sutton owns along with Crown Acquisitions and Midtown Equities, is valued at more than $100 million based on Duane Reade’s increased rent and the air rights over the two-story building, sources told the publication.
Those air rights helped the borrowers lock down a lower interest rate.
“Times Square is a prime location for retail because of its heavy pedestrian traffic and accessibility to Port Authority and numerous subway lines,” said Meridian Capital Group’s Carol Shelby, who negotiated the deal on behalf of the borrowers. “Additionally, the available signage-rights gives the property significant upside potential.”
Duane Reade’s lease expires in December 2021, according to Trepp. [CO] – Rich Bockmann