Himmel + Meringoff Properties has struck a $93 million recapitalization of its mixed-use office asset in Midtown West, Manhattan, called 525 West 57th Street.
As reported by the Commercial Observer, the investment firm plans to use the proceeds for work on the nearby Mount Sinai West hospital. This includes future leasing of 63,000 square feet of space at the building and completing 50,000 square feet of construction for the center's dermatology and neurological departments.
Delaware Life provided the mortgage while Newmark negotiated the deal. Leslie Himmel and Stephen Meringoff of Himmel + Meringoff "infused additional equity in the property," according to the CO.
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The average term for tenants at 525 West is 20 years. In addition to office, the building offers medical and laboratory space. The term and the mixed-use components offer the property the ability to withstand market volatility.
“We are very close to Mount Sinai West, so the proximity to that hospital was part of the allure for the Mount Sinai dermatology and neurology groups,” Himmel told the news outlet.
“That was part of our success in the leasing of this building, a lot of which we did through COVID.”
This deal speaks to the demand for life companies in CRE and their long-term belief in insurance premiums. The news outlet said, citing sources, that these firms are particularly "aggressively seeking New York City asset exposure."
The life science sector is currently in a mixed state, as a recent CBRE national report showed. In the fourth quarter, the asset class posted net absorption of 920,000 square feet, marking the third time in the past five quarters that the category has been positive. However, an influx of supply has pushed the vacancy rate to 19.7 percent. That trend is expected to continue throughout 2025, most notably in the Boston, San Francisco Bay Area, and San Diego markets.
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