The property, at 252 Seventh Ave., was renovated in 1998 into 351 condominium units, which have since been sold. Rockrose retained the 80,967-sf of retail space, split into five commercial units, and now 100% leased to Whole Foods Market and Imperial Parking. Whole Foods has expanded the store, its first in Manhattan, since first moving in, setting up a 5,000-sf Whole Body store in a retail vacancy in the building. Whole Foods' lease is up at the end of 2015.
Wes Boatwright, Lisa Bozzelli and Brandon Flickinger of JLL's REIB coordinated the effort.
"This was a unique deal," Boatwright tells GlobeSt.com. "Financing a condominium has certain challenges. Unlike a fee-simple deal, you have shared operating expenses. Normally, renters wouldn't have had issues with it, but it's a testament to the strength of the owner. And the fact that you have Whole Foods in there."
The loan would be a refinancing, except that Rockrose already controlled the property. "They owned it free and clear," Boatwright says. REIB worked out a 10-year, 80% loan-to-value, interest-only deal for Rockrose.
"What got lenders comfortable was the gentrification and redevelopment of the Chelsea market, the strength of the sponsor, and the fact that Whole Foods was in there at a rent considerably below if Whole Foods was to leave," Boatwright says.
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