Himmel + Meringoff Recaps, Refis NYC Office Building
Delaware Life provided a $93 million first mortgage.
Himmel + Meringoff Properties has wrapped up a two-sided deal with its 300,000-square-foot mixed-use building at 525 W. 57th St. in Manhattan, combining a major refinance through Delaware Life with a “significant recapitalization” by Co-Managing Partners Leslie Himmel and Stephen Meringoff, the Commercial Observer first reported.
Delaware Life’s new first mortgage was for $93 million but the amount of the equity infusion by Himmel + Meringoff was not disclosed.
The new funding reportedly is to be used to finish construction of 50,000 square feet of medical space for Mount Sinai West hospital’s neurological and dermatology departments, and also cover expenses associated with leasing the building’s 63,000 square feet of vacant space.
Joshua King, Adam Spies and Christopher Kramer of Newmark negotiated the refi, according to the same source.
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Other significant tenants at the building, which encompasses office, medical and laboratory space, include the city of New York, the International Multiple Sclerosis Management Practice and the Tisch Multiple Sclerosis Research Center of New York.
Surviving a failed bank
While the building’s location is an asset, its previous lender, Signature Bank, was very much not. The prior mortgage for 525 W. 57th St. was a $105 million loan from Signature and reportedly one of that bank’s largest loans in New York City.
Signature Bank failed the same week as the higher-profile Silicon Valley Bank, though SVB had CRE loan holdings vastly smaller than Signature’s—about $2.6 billion versus about $33 billion.
In December 2023, a joint venture of two Blackstone subsidiaries, along with the Canada Pension Plan Investment Board and Rialto Capital, acquired a 20 percent stake in Signature’s $16.8 billion then-remaining senior mortgage loan portfolio for $1.2 billion. The Federal Deposit Insurance Corp. was to retain 80 percent ownership.
Year-to-date office leasing in Manhattan totaled 5.13 million square feet, an increase of 49 percent from the prior year and the strongest start to a year since 2014, according to a March report from CBRE. Concurrently, the availability rate declined to 18.4 percent, a drop of 180 basis points from a year earlier.
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