Narrative
Full Description
Project narrative
In or around November 2010, the New York Branch of Bank of China (BOC) entered into a $800 million USD (£498.26 million GBP) mortgage loan agreement with Brookfield Office Properties Inc. (BPO) — a Canada-incorporated real estate developer, owner, and manager focused on office properties in the United States, Canada, Australia, and the United Kingdom with its registered office in Toronto, Ontario and listed on the New York Stock Exchange and the Toronto Stock Exchange — for the 245 Park Avenue 2010 Refinancing Project. This loan carried an interest rate based on a fixed rate and a maturity period of 10 years. This loan was secured by (i.e. collateralized against) 245 Park Avenue. The proceeds were to be used by the borrower to refinance debt on 245 Park Avenue, a 44-story, 1.7 million-square-foot Class A office tower near Grand Central Terminal located on Park Avenue between East 46th and East 47th Streets in midtown Manhattan, New York City, New York. Record ID#106467 captures the original $800 million USD loan. 245 Park Avenue was 51% owned by Brookfield Office Properties and 49% by the New York State Teachers’ Retirement System. 245 Park Avenue's tenants included J.P. Morgan, Major League Baseball, Coöperatieve Rabobank U.A., Société Générale, Angelo Gordon & Co., Heineken USA, and Wisdom Tree Investment. The loan was reportedly the biggest on a single building provided by a single lender during the economic downturn. It was also the largest loan ever made by BOC New York City's branch to that point. In April 2015, it was reported that BOC was negotiating with Brookfield Properties to up-size the loan by $200 million USD to $1 billion USD, providing a borrower with an “additional cash-out advance." The loan was due to close later in April 2015. The loan was ultimately increased by $200 million USD to $1 billion USD in 2015. Record ID#106468 captures the $200 million USD up-sizing. In May 2017, Brookfield Property Partners sold 245 Park Avenue to a consortium led by Chinese conglomerate HNA Group Co., Ltd. for $2.21 billion USD. HNA Group entered into a 10-year fixed-rate $1.75 billion USD syndicated mortgage loan agreement with a syndicate of banks led by J.P. Morgan and including Deutsche Bank, Barclays Bank Plc, Natixis, and Société Générale. The proceeds were to used by the borrower to finance the acquisition and to retire (refinance) the $1 billion USD BOC loan.
Staff comments
1. Sources describe Brookfield Office Properties as the borrower, though it is plausible, if not likely, that a special purpose vehicle subsidiary of Brookfield Office Properties was the borrower. It is also possible the borrower was the actual joint venture 51% owned by Brookfield Office Properties and 49% by the New York State Teachers’ Retirement System. 2. In June 2014, Brookfield Property Partners acquired Brookfield Office Properties. Brookfield Property Partners L.P. is Bermuda-based subsidiary of Canada's Brookfield Corporation.