NEW YORK CITY—A partnership of Ivanhoe Cambridge and Callahan Capital reportedly is on the hunt for a $1 billion fixed-rate mortgage on the News Corp. headquarters building, at 1211 Ave. of the Americas, according to Commercial Mortgage Alert. Securitization entities as well as insurance firms are eyeing the 10-year assignment, which reportedly is being shopped by Eastdil Secured. The sheer size of the request, however, makes it a likely candidate for the CMBS market. The loan-to-value ratio would be less than 50%.
Representative of Ivanhoe declined to comment to GlobeSt.com while an Eastdil Secured brokerage executive did not respond to a request for comment by press time.
The Ivanhoe partnership would use the proceeds to retire $950 million of fixed-rate debt that Lehman Brothers originated in 2006. Lehman securitized the senior $675 million via two pooled offerings and placed $275 million of mezzanine debt with high-yield investors. That debt package matures in September 2016, Commercial Alert explains.
The 1.9 million-square-foot building is over 92% occupied, according to CoStar. News Corp. has a lease on 975,000 square feet until 2020. Other tenants include law firm Ropes & Gray, which has 290,000 square feet until March 2019; AXIS Re, 121,000 square feet until 2023; and RBC Wealth Management, 63,000 square feet until 2024.
The 45-story property formerly was owned solely by Boston fund shop Beacon Capital. The $2 billion Beacon Capital Strategic Partners 4 fund acquired it for $1.5 billion in 2006 from Jamestown Properties. In late 2013, Beacon sold a 51% stake to the team of Ivanhoe and Callahan Capital of Chicago for close to $893 million. Montreal-based Ivanhoe is a unit of pension fund advisor Caisse de Depot et Placement du Quebec. Beacon also has syndicated another 19% interest to other investors, reducing its stake to 30%.
The building, which is between West 47th and West 48th streets on the west side of Sixth avenue, was developed in 1973 by New York-based Rockefeller Group. It was formerly known as the Celanese Building, when Celanese Corp. had its headquarters there.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
