Rockefeller Center to Raise $3.4B for Refinancing

Real estate company Tishman Speyer and investment firm Henry Crown & Co. are raising $3.4 billion through a single-borrower CMBS transaction secured by Rockefeller Center’s office and retail space. The figure represents the majority of the $3.5 billion fixed-rate, interest-only mortgage loan on the properties, according to KBRA’s pre-sale report.

The portion in question is a 7.2 million square foot, 13-building mixed-use office and retail complex. There is also a first-priority pledge of “equity interests in affiliates of the borrower that operate the various amenities and attractions at the property,” the firm noted in a press release. The properties were 92.6% leased to more than 400 tenants in July 2024.

A KBRA financial analysis found a net cash flow of about $273.6 million, which is about 18% less than the issuer’s net cash flow expectation. Also, KBRA’s valuation of the property was about $3.73 billion —38.9% below the appraiser’s as-is value. That makes the loan-to-value in KBRA’s view 93.9%.

If and when the financing is done, the securitization will be in the top five of such single-asset, single-borrower CMBS deals since 2014 and the largest after 2021, according to Bloomberg. That previous one was 560 hotel properties associated with Extended Stay America. The CMBS sold for $4.65 billion.

This current CMBS bond sale would refinance $3 billion in current debt, provide $246.8 million for reserves, and $179.8 million in cash to Tishman Speyer and Henry Crown. “A majority of the property previously secured a $1.7 billion loan that was securitized in the GSMS 2005-ROCK transaction,” KBRA wrote. “According to Trepp, the prior CMBS loan was never reported delinquent.”

Tishman Speyer, founded in 1978, owns and operates 82 million square feet across 36 markets in Europe, Asia, and North America. Henry Crown & Co. has been privately owned since 1919. It invests in sectors including publicly traded securities, real estate, funds, and private companies. A joint venture of the two companies has owned Rockefeller Center since 1996.

In total, the mixed-use area comprises 5.5 million square feet of mainly Class A/A- office space, 1.4 million square feet of street- and lower-level retail space, and 280,000 square feet of storage space. It is also home to Radio City Music Hall, the Top of the Rock observation deck, The Rink at Rockefeller Center, the Rainbow Room, and other private event spaces, including 620 Loft and Garden, retail and pedestrian lower-level concourse connecting all buildings. Plus, the area provides access to retail shops, restaurants, and the adjacent subway station.

According to KCRA, the minimum required debt service coverage for the mortgage is 1.05 times. The firm determined that the actual DSC is 1.20 times. The issuer-implied cap rate is 5.51%. KBRA calculated its own take on a cap rate of 7.34%.