Vornado Completes $260M Multifamily Refinancing

Located in Pentagon City, VA, River House is a 1,670-unit, three-building complex whose refinancing--along with the proceeds from a land sale scheduled to close this year--will register Vornado's total investment in the H Street Building subsidiary at $409 million. Of that figure, $78 million is cash, and the remainder, debt.

Vornado declined to comment on the refinancing. However, according to its public statements, the firm has been very active in the debt and equity markets lately; last month it landed financing for three properties in the District and refinanced its 1.8-million-sf Green Acres Regional Mallin Long Island for $335 million. That interest-only loan has a rate of Libor plus 1.40% and is scheduled to mature in February 2011, with two one-year extension options. After repaying the existing loan and closing costs, the company realized net proceeds of approximately $193 million.

Vornado also procured a $150-million loan for its recently redeveloped office property at 2101 L St.; a $104-million construction loan for its residential development project at 1229-1231 25th St. in the West End part of the District and; a $87-million construction loan for its residential development at 220 20th St., formerly Crystal Plaza Two.Refi borrowers with specific criteria and deal characteristics are finding the refinance marketto be cautiously favorable right now, as GlobeSt.com recently reported. Speaking generally and not of the specific Vornado transaction, Richard Swartz of Cushman & Wakefield Sonnenblick tells GlobeSt.com that if a deal's LTV is low enough--at a 60% LTV or less--"this is probably a good time to refinance because the rates are low." Anything higher--and definitely LTVs that breach the 75% mark--borrowers will be facing higher spreads or will have to bring in a more expensive mezz layer, he adds.