HNA’s 850 Third Avenue Gets $342M Refi from Natixis, Paramount & Harbor

Natixis, real estate investment trust Paramount Group, and Harbor Group International recently provided $342 million in refinancing for the property at 850 Third Avenue. The Midtown Manhattan office building is owned by HNA Group, in partnership with MHP Real Estate Services and ATCO Properties & Management. According to the Commercial Observer, Natixis provided a $242 million senior loan, while a $100 million mezzanine loan was split between Paramount and Harbor—$75 million from Paramount and $25 million from Harbor.

The short-term, floating-rate loan is meant to replace the $238 million in acquisition financing provided by Morgan Stanley in March 2016. A NKF Capital Markets team led by Jordan Roeschlaub and Dustin Stolly, and a Cooper-Horowitz team led by Richard and David Horowitz co-brokered the financing.

850 Third Avenue (Property Shark)

The 21-story, 617,000-square-foot, Class A office building was purchased for $463 million in 2016. The asset is currently 91% occupied, but its largest tenant, Discovery Communications, plans to vacate its 190,000 square feet when its lease expires in 2020. This would lead to nearly one third of the building becoming available.

850 Third Avenue might also change owners. HNA, once eager to purchase trophy real estate overseas, has told creditors it will sell $16 billion worth of assets in the first half of 2018 to lighten its balance sheet, as reported by Bloomberg. The Chinese conglomerate is struggling with higher interest payments than net profit, and it has already sold two other U.S. properties to Northwood Investors—1180 Avenue of the Americas for $305 million, and 123 Mission Street in San Francisco for $300 million. Moreover, less than a year after purchasing 245 Park Avenue for $2.21 billion, HNA is in talks to sell at least a part of it to SL Green Realty Corp.

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