SL Green Closes on Sony Building Financing

NEW YORK CITY-SL Green Realty Corp. said Wednesday that the $925-million bridge acquisition financing it arranged for the Sony Building at 550 Madison Ave. has closed. A consortium led by the Chetrit Group entered a contract to acquire 550 Madison, currently the US headquarters for Sony Corp. of America, in a $1.1-billion sale-leaseback.

SL Green says the financing matures contemporaneously with the expiration of Sony's leaseback of the 37-story property. It consists of a $600-million senior loan originated by Bank of China; a $175-million senior mezzanine debt that SL Green sold to a private investment manager; and a $150-million junior mezzanine debt originated by SL Green. After the financing was completed, SL Green sold one half of its interest in the junior mezzanine debt.

“This deal illustrates SL Green's ability to structure, syndicate and execute financing for complex capital transactions,” David Schonbraun, SL Green's co-CIO, says in a release. “While we are best known as New York City's largest office landlord, we also have emerged as a major player in the structured finance arena. In that regard, SL Green is now the primary provider of subordinate capital for real estate transactions in the greater New York market.”

The REIT's involvement in the financing Sony Building deal first surfaced in the weeks after the deal was announced in mid-January. Ironhound Management was the exclusive advisor to the borrower.