NEW YORK–Holliday Fenoglio Fowler, L.P. (HFF) announces the $479 million construction financing for Hudson Commons, a 25-story, 701,364-square-foot trophy office building in the Hudson Yards/Penn Plaza submarket of Manhattan.
The HFF team worked on behalf of Cove Property Group and an institutional partner to secure construction financing through investment funds managed by affiliates of Apollo Global Management, including Apollo Commercial Real Estate Finance, Inc. (NYSE:ARI). Loan proceeds will be used to reposition and redevelop the asset into an iconic Class A office tower with full block frontage along Ninth Avenue.
Hudson Commons is located at 441 Ninth Avenue between 34th and 35th Streets in the greater Hudson Yards submarket, a destination of choice for global corporations. The asset benefits from superior transportation access, being equidistant between Penn Station and the new 7 train extension servicing Hudson Yards, along with easy access to the Port Authority and Lincoln Tunnel. Designed by world-renowned architects Kohn Pedersen Fox, Hudson Commons will feature a 17-story structure on top of an existing eight-story building with 14 private terraces and balconies and onsite basement parking for up to 140 vehicles. The contemplated design will incorporate not only highly efficient and varied floor plan layouts with high ceilings, but also unique and sustainable elements such as terraces and green roofs, as well as the commitment to an adaptive reuse of an existing property that will differentiate it from the surrounding glass and steel towers being completed in the area.
The HFF debt placement team representing the borrower included senior managing director Michael Gigliotti, senior director Geoff Goldstein and executive managing director Michael Tepedino.
According to a prepared statement from Cove, “A lot has already been made of the unprecedented transformation of Hudson Yards and the Penn Plaza neighborhood, which will be a beacon for Manhattan for time to come. We feel that the uniqueness of the property’s history and characteristics as an industrial warehouse within this neighborhood really allowed us to combine old and new in what we feel will be a truly differentiated experience for tenants. The thoughtfully designed floor plates that range from 16,000 to 50,000 rentable square feet, combined with 14-foot ceiling heights throughout, an abundance of outdoor space and amenities will allow tenants to focus on attracting and retaining the world’s best talent. Work has already started in earnest for us, but with the closing of this loan we are very excited to sprint to the finish line. We expect to be finished by the summer of 2019 but will be ready to receive tenants even earlier – by the final quarter of 2018.”
“Given the world-class design, the spectacular transit-oriented location within the Hudson Yards submarket and the stellar reputation of the development team, Cove Property Group was able to achieve highly accretive construction financing,” Gigliotti said. “It was a pleasure for HFF to be associated with such a distinctive project.”
Cove is a New York City-based joint venture formed between Kevin Hoo, Thomas Farrell, Amit Patel and Blue Sky Alternative Investments focused on real estate investment, development and ownership. Cove’s team has a combined 50 years of direct property acquisition / disposition, development, ownership and asset management expertise, which integrates seamlessly with an entrepreneurial, yet significant equity partner to form a well-capitalized real estate operating platform with deep experience. Cove focuses on investment and redevelopment, as well as ground-up development, of key asset types including commercial office, retail, residential and industrial.
