Vornado Realty Trust is continuing to make noise in Manhattan with big deals. This next one will apply to its PENN 11 office asset, which it is getting a new $450 million loan.
The refinancing will carry a five-year term through August 2030, with a fixed rate of 6.35 percent. The debt will replace the old $500 million loan, which was scheduled to mature in October 2025.
The property in Manhattan's Penn District spans 1.2 million square feet. According to Vornado, the 26-story asset recently underwent renovation to restore the lobby's ceiling to its original splendor and added a 560 square foot pixel screen in the area. The building serves as the New York headquarters for Macy's and AMC Networks.
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This marks Vornado's at least third deal in Manhattan in recent months. In May, the REIT's joint venture agreed to sell its Chelsea office tower, 512 West 22nd Street, for $205 million in a transaction expected to close in the third quarter. Then, in June, Vornado Realty Trust, along with partner Stellar Management, struck a $675 million deal to refinance a residential property in Tribeca. Vornado owns 50.1 percent of the property.
For office, Manhattan is coming off its best leasing first half since 2014, posting 21.1 million square feet of signings to start 2025, according to a report from Savills. That came as space became more limited, with the availability rate dropping 280 basis points year-over-year to 17.2 percent in the second quarter. Interestingly, Class B and C assets showed the strongest performance in that category, defying the national office trend, which has broadly been a fight to quality since the pandemic lockdowns ended.
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Anthony Russo
Anthony Russo has been contributing to GlobeSt. since July 2024. Along with CRE, his financial background expands to capital markets, the economy, and consumer issues. Previously, he has written for CapitalWatch and was a senior reporter for The US Sun.
