David Rosenberg and Seth Grossman of Meridian's New York Cityoffice negotiated on behalf of the borrowers, Jeff Sutton oflocally based Wharton Properties and Manhattan based SL GreenRealty Corp., to secure an interest-only, floating-rate loan. TheJV partnership was created to identify and invest inunder-performing retail assets. The first venture was to acquirethe fee interests in two adjoining retail buildings at 1551 and1555 Broadway, and in a third retail and commercial building at 21W. 34th St. The second joint venture included acquisition of amixed-use property at 141 Fifth Ave. The transactions totaledapproximately $162.5 million.

After purchasing the property several years ago, Suttonbought-out Hugo Boss from its ground-floor retail lease and thensignedluxury retailer Armani to a 15-year, multi-floor lease, for morethan 40,000 sf. The four-level retail condominium at 717 Fifth Ave.boasts a three-story glass atrium. Laura Pomerantz of PBS RealEstate represented Armani in that transaction. The space iscurrently being built-out by Armani and the anticipated openingwill be early 2009, which Grossman says is still on track.

Grossman tells GlobeSt.com that completing the refi now wasextremely important. "Existing debt came due on the day that weclosed with no extensions—it needed to happen with no room forerror or the borrower would have needed to write a check for $192million to payoff the existing that day." He continues "that timingwas on there side however, because the Armani lease was signed andHugo Boss was bought out of their space to make that happen sincethe initial mortgage was put on." The borrowers increased rents"tremendously" since the original financing, which is why, Grossmansays, "the borrowers were able to replace a $192.5-millionloan—which included roughly $60 million of mezz--with a new firstmortgage of $285 million."