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<\/p>\nAfter executing five one-year extensions,\u00a0Park Avenue-based real estate investment firm\u00a0Savanna has run out of time to pay off a nearly half-billion-dollar loan tied to a Midtown Manhattan office tower.<\/p>\n
<\/p>\n
\n 5 Bryant Park in Midtown Manhattan, owned by Savanna\n <\/p>\n
The $463M CMBS loan tied to 5 Bryant Park matured on June 8.\u00a0Savanna<\/a> failed to make the required balloon payment, according to\u00a0a report from CMBS tracking firm CRED iQ<\/a>.<\/p>\n Savanna took out the loan in 2018 to finance\u00a0its $640M purchase<\/a> of the 34-story Midtown Manhattan<\/a> tower from Blackstone<\/a>. While the loan was initially scheduled to mature in June 2020, it also came with five one-year extension options. All of those have been exercised.<\/p>\n The 683K SF building on Sixth Avenue was 81% occupied at the end of March, according to servicer commentary on the Morningstar Credit database. Its net cash flow has fallen more than 20% from the debt’s underwriting, according to Morningstar Credit Analytics\u00a0Senior Vice President David Putro<\/a>.<\/p>\n Interest payments and operating expenses have both increased, and the debt is now underwater, Putro said.<\/p>\n Savanna didn’t immediately respond to a request for comment.<\/p>\n The loan\u00a0has been on a watchlist due to\u00a0the drop in its net operating income. Savanna has been in talks with the loan’s master servicer and hopes to have a refinancing deal in place within 90 days, according to commentary posted early last month.\u00a0<\/p>\n S&P Global downgraded<\/a>\u00a0three classes of the CMBS debt in September, including the $200M top-rated class, which it lowered from a AAA rating to AA.\u00a0Part of the\u00a0lowered rating was because tenants occupying 45% of the building are due to have their leases expire between 2027 and 2029.<\/p>\n The loan on 5 Bryant Park is the second tied to an office building in the neighborhood that Savanna had trouble refinancing. It\u00a0defaulted on a $242M loan<\/a> at 521 Fifth Ave. last year, which was transferred to special servicing. Wells Fargo\u00a0sued to foreclose on the building<\/a> in November.<\/p>\n Wells Fargo won a default judgment in that case in May, according to court records<\/a>. A New York State Supreme Court judge appointed a referee to coordinate a possible foreclosure sale.<\/p>\n While Savanna has been reckoning with upside-down capital stacks on its prepandemic office acquisitions, it is also back in the role of aggressor. It bought 799 Broadway in Midtown South last year\u00a0for 4% below<\/a>\u00a0the value of the building’s debt. It also has begun construction on a luxury condo tower in West Palm Beach after\u00a0landing a $380M construction loan<\/a>\u00a0in March.<\/p>\n","protected":false},"excerpt":{"rendered":"After executing five one-year extensions,\u00a0Park Avenue-based real estate investment firm\u00a0Savanna has run out of time to pay off…\n","protected":false},"author":3,"featured_media":66329,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5122],"tags":[47040,5229,47041,6307,405,403,5226,5225,5228,5227,47039,47042,47038,67,586,132,5230,68,2969],"class_list":{"0":"post-66328","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-new-york","8":"tag-5-bryant-park","9":"tag-america","10":"tag-david-putro","11":"tag-midtown-manhattan","12":"tag-new-york","13":"tag-new-york-city","14":"tag-newyork","15":"tag-newyorkcity","16":"tag-ny","17":"tag-nyc","18":"tag-nyc-office","19":"tag-office-distress","20":"tag-savanna","21":"tag-united-states","22":"tag-united-states-of-america","23":"tag-unitedstates","24":"tag-unitedstatesofamerica","25":"tag-us","26":"tag-usa"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/114854740907782958","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/66328","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=66328"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/66328\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/66329"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=66328"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=66328"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=66328"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}