WASHINGTON, DC-A source has confirmed to GlobeSt.com that New York State Teachers has provided a $90.6-million mortgage on Paramount Group’s acquisition of 1899 Pennsylvania Ave. The 60% LTV loan was secured by Cassidy Turley. 

The property was sold by the KanAm Group in September for $812 per square foot, or $151.1 million. It was one of a handful of $800 per square feet deals since the start of the credit crisis. The other was also a KanAm property: the 227,000-square-foot Evening Star building, which traded for close to $180 million.

While the market looks to the deals themselves as indicators that property trades are beginning to move again, the post sale financing is also a key indicator of health. In this case, New York State Teachers has steadily been backing DC-area loans for properties, the source says.

Another positive sign for the market: Cassidy Turley also secured via MetLife a $160-million mortgage for the 398,000-square-foot Terrell Place office complex that recently traded for $265 million. Cassidy Turley declined to comment on the transactions. In earlier interview, Phil Mudd of Cassidy Turley, told GlobeSt.com that life companies are stepping up the levels of leverage they are willing to tolerate.

The company is working on a handful of office finance transactions involving life companies in which the debt leverage ratios range from the very low end of 40% to a bordering-on-aggressive 70%. While the willingness of some firms to accept 70% LTVs is telling, so is the fact that the majority of firms still favor deals that are of moderate leverage, or 60% to 65%, according to Mudd. “I would say moderate leverage still rules the day, but it is interesting that some firms are edging higher.”