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Vornado Makes $200M Mezzanine Loan for GM Building

NEW YORK CITY-The GM Building continues to be a newsmaker as Vornado Realty makes a $200 million mezzanine loan secured by partnership interest in the trophy property.

By Barbara Jarvie | Updated on October 20, 2003

NEW YORK CITY-Vornado Realty Trust made a $200 million mezzanine loan secured by partnership interests in the General Motors Building, which was acquired by Macklowe Properties in September for whopping $1.4 billion.

Vornado’s loan is subordinate to $900 million of other debt. The loan is based on a rate of LIBOR plus 8.685% with a LIBOR floor of 1.5% and currently yields 10.185%. The loan matures in October 2005, with three one-year extensions. Further, the REIT will make an additional $25 million loan, as part of a $50 million loan, the balance of which will be funded by an affiliate of Soros Fund Management LLC. The loan, which is junior to the $1.1 billion of loans, is based on a rate of LIBOR plus 12.81% and currently yields 14.31%. The loan matures in October 2005, with three one-year extensions, and is expected to be funded in the next 30 days.

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