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Overview

Bank of China contributes to a $575 million USD syndicated loan for the Two Penn Plaza 2014 Refinancing Project

Commitments (Constant USD, 2023)$117,938,616
Commitment Year•2014Country of Activity•United StatesDirect Recipient Country of Incorporation•United StatesSector•Business And Other ServicesFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Dec 8, 2014
Last repayment (originally scheduled)
Dec 7, 2019

Geospatial footprint

Map overview

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The proceeds were to be used by the borrower for the refinancing an existing $422 million USD loan on Two Penn Plaza, a 1.6 million-square foot office building located in Manhattan, New York City, New York. Its exact address is PENN 2, 2 Pennsylvania Plaza, New York, NY 10121. More detailed locational information can be found at https://www.openstreetmap.org/way/35938543

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Commercial Banks

  • Bank of China (BOC)

Cofinancing agencies

Private Sector

  • DGB Dekabank
  • HSBC Bank PLC
  • MUFG Union Bank, N.A. (formerly Union Bank of California, N.A.)

State-owned Banks

  • Landesbank Baden-Württemberg (LBBW)

Receiving agencies

Private Sector

  • Vornado Realty L.P.

Loan description

Bank of China contributes to a $575 million USD syndicated loan for the Two Penn Plaza 2014 Refinancing Project

Interest rate (t₀)•1.9899%Interest type•Variable Interest RateMaturity•5 years

Collateral

This loan was secured by a mortgage on Two Penn Plaza, a 1.6 million-square foot office building located in Manhattan, New York City, New York.

Narrative

Full Description

Project narrative

On December 8, 2014, a five-bank syndicate — the Bank of China (BOC), HSBC Bank, Landesbank Baden-Württemberg (LBBW), DekaBank, and Union Bank, N.A. — entered into a $575,000,000 USD syndicated loan agreement with Vornado Realty L.P. — a Delaware-incorporated limited partnership supermajority-owned by its general partner Vornado Realty Trust, a Maryland-incorporated real estate investment trust headquartered in New York City and listed on the New York Stock Exchange — for the Two Penn Plaza 2014 Refinancing Project. This interest-only loan carried a maturity period of five years with two one-year extension options, a final maturity date in December 2019, and an interest rate of LIBOR plus a margin of 165 basis points (bps). This loan was secured by (i.e. collateralized against) a mortgage on Two Penn Plaza. The proceeds were to be used by the borrower for the refinancing an existing $422 million USD loan on Two Penn Plaza, a 1.6 million-square foot office building located in Manhattan, New York City, New York; Vornado realized net proceeds of approximately $143,000,000 USD on the refinancing. On September 27, 2019, the borrower repaid the $575 million USD using its unsecured revolving credit facilities.

Staff comments

1. The individual contributions of the five lenders to this $575 million USD syndicated loan are unknown. Therefore, for the time being, to estimate BOC's contribution, AidData has assumed that each lender contributed equally ($115,000,000 USD) to the loan syndicate. 2. A 6-month LIBOR was assumed. The average six-month LIBOR for December 2014 was 0.34302%. Therefore, the interest rate has been coded as 0.34302% + 1.65% = 1.99302%. 3. It is plausible, if not likely, that the specific borrowing institution was a special purpose vehicle subsidiary of Vornado Realty L.P. This issue merits further investigation. 4. Two Penn Plaza was later rebranded as 2 PENN.