HFF Secures $479M In Construction Financing for Hudson Commons

Holliday Fenoglio Fowler, Houston, secured $479 million in construction financing for Hudson Commons, a 25-story, 701,000-square-foot office building in Manhattan’s Hudson Yards/Penn Plaza submarket.

An HFF debt placement team including Senior Managing Director Michael Gigliotti, Senior Director Geoff Goldstein and Executive Managing Director Michael Tepedino worked for Cove Property Group, New York, and its institutional partner Baupost Group, New York.

Apollo Global Management, New York, funded the loan, which Cove will use to reposition and redevelop the asset into a Class A office tower with full-block frontage along Ninth Avenue.

Hudson Commons at 441 Ninth Avenue between West 34th and West 35th Streets will be a 17-story structure on top of an existing eight-story building with 14 private terraces and balconies. The new building’s floor plates will range from 16,000 to 50,000 rentable square feet with 14-foot ceiling heights throughout. Cove expects a summer 2019 delivery but said it will be ready to receive some tenants by late 2018.

The Real Deal New York reported the venture acquired the site for $330 million last year.

In New Jersey, HFF secured $17.4 million in acquisition financing for Commons at Hooper, a 120,500-square-foot community shopping center in Toms River.

HFF represented the borrower, a partnership between Unison Realty Partners, Boston, and ALTO Real Estate Funds, New York, to place a five-year fixed-rate loan with OceanFirst Bank, Toms River OceanFirst also provided a $3.4 million construction line the borrower will use for capital and tenant improvements and leasing commissions.

HFF Managing Directors Michael Klein and Greg Labine led the debt placement team. Klein said the borrower plans to lease the remaining available space, extend tenants with pending maturities early and invest in capital improvements to attract new tenants to the property. “Additionally, the borrower may pursue an opportunity to construct a 2,500-square-foot pad site in the front of the center,” he said.

Completed in 1987, the 86 percent leased Commons at Hooper houses 21 retail tenants including Michaels, DSW and Dollar Tree.

“With OceanFirst Bank’s corporate headquarters a half mile from Commons at Hooper, they were very familiar with the asset and easily understood what the borrower was trying to accomplish,” Klein said. “The bank provided a creative structure that would allow the partnership to execute its business plan and was able to close within a tight closing time frame.”