Dealmaker: Savanna Secures $100M in Construction Financing
Savanna, New York, secured $100 million in construction financing for 106 West 56th Street in Manhattan, a 26-story Class A office building scheduled for 2019 delivery.
Savanna’s joint-venture partner on 106 West 56th Street is Atom Assets, Hong Kong, a real estate investment platform for Asian family offices and high net worth individuals.
JLL Managing Director Kellogg Gaines, Executive Vice President Aaron Niedermayer and Capital Markets Analyst Douglas Baillie arranged a senior construction loan from United Overseas Bank, Singapore, and mezzanine financing from Canyon Partners Real Estate, Los Angeles.
“New York remains an incredibly attractive space to build high-end office product,” Gaines said. “Lenders both domestic and abroad are comfortable with the city’s dynamics.”
Niedermayer noted that with floor plates between 2,500 and 4,500 square feet, the property will offer smaller tenants an opportunity to occupy their own floor, “something almost unheard of in this location and in the luxury office market,” he said. “Despite no pre-leasing, we were able to demonstrate to lenders the depth of the luxury office market and the fact that nothing like this project exists in the market today for smaller tenants.”
The transaction is the first between Canyon and Savanna, but Canyon has committed more than $637 million in 21 New York investments through senior loans, mezzanine loans, preferred equity and common equity since 2005.
The property will be just west of Avenue of the Americas (Sixth Avenue) on 56th Street, three blocks from Central Park. It will total 90,000 square feet with a tiered glass façade and landscaped terraces, marketed to high-end office users.
Savanna Director Andrew Kurd said there is a “void” in amenity-rich office properties for high-end tenants. The firm tapped CBRE Vice Chairman Peter Turchin and First Vice President Christie Harle to head the leasing campaign.
Savanna expects to begin vertical construction of 106 West 56th Street early next year with completion scheduled for third-quarter 2019.
Law firm Cole Schotz P.C., Hackensack, N.J., advised Savanna on the transaction.
