The huge refinancing displays the worth that 601W has injected into the constructing with a formidable roster of recent tenants, defying a broader leasing slowdown with the COVID-19 pandemic accelerating the rise of distant work. After inking latest offers with heavy-duty instrument maker Milwaukee Software and well being care administration advisor Vizient, the constructing is now about 95% leased, in line with leasing brokerage Telos Group.
601W has reportedly spent near $1 billion redeveloping and leasing up the constructing, which sat vacant for near twenty years till the developer purchased it for $130 million in 2016 and started a intestine rehab the following 12 months.
The developer took out a $500 million construction loan from JPMorgan Chase and private-equity large Blackstone Group in 2017 and mentioned on the time it was placing up $250 million in fairness for the venture. After signing its first main tenants, akin to Uber and Walgreens Boots Alliance, extra shortly than it anticipated, 601W put extra debt on the property with the 2019 mortgage. The constructing was appraised in October 2020 at $913.5 million, in line with Bloomberg information tied to the 2019 mortgage.
Outstanding tenants on the Outdated Publish Workplace at this time embrace Cisco Techniques, Ferrara Sweet, PepsiCo and the father or mother firm of the Chicago Board Choices Trade.
A 601W spokeswoman didn’t present a touch upon the brand new mortgage. Public data present that, just like the debt that 601W paid off final month, the brand new mortgage can also be tied to a 250,000-square-foot annex constructing adjoining to the Outdated Publish Workplace at 358 W. Harrison St., in addition to a parking zone at 527 W. Clinton St., instantly west of the principle constructing.
With tenants beginning to transfer in and pay lease in 2020, the Outdated Publish Workplace generated web money movement of simply $4.3 million, lower than 601W’s $5.7 million in debt service for the 12 months, in line with Bloomberg information. The lender in 2019 projected that web money movement would develop to a stabilized determine of $64.6 million by late 2023, mortgage paperwork present.
The brand new mortgage can also be anticipated to be offered off to CMBS buyers, in line with CoStar Information, which first reported 601W had landed the mortgage.