- Brookfield Corp. will provide $172.5M in cash equity to refinance 225 Liberty St.
- The 2.4M SF tower secured a new $800M five-year CMBS loan with major banks.
- The property was 90.1% leased as of November, excluding Saks Global’s delinquent lease.
- Brookfield recently extended its ground lease for the Brookfield Place complex to 2119.
Major Office Refinancing in Lower Manhattan
According to Bisnow, Brookfield Corp. is investing heavily to refinance its flagship office tower at 225 Liberty St. within Brookfield Place, Lower Manhattan. The company has secured an $800M CMBS loan from a lending group including Citi Real Estate Funding, JPMorgan Chase, The Bank of Nova Scotia, and Wells Fargo. This new fixed-rate, five-year mortgage carries an interest rate of nearly 5.9%.
In addition to the mortgage, Brookfield will inject $172.5M of cash equity into the transaction. The refinancing replaces a $900M loan that originated in 2016 and recently reached maturity. A new appraisal values the 44-story tower at $1.3B.
Leasing and Occupancy Insights
Office refinancing at Brookfield Place comes as the 2.4M SF tower reports strong occupancy. As of November, 225 Liberty St. was 90.1% leased. Brookfield Properties occupied 535K SF in the tower. However, Saks Global’s 233K SF lease was excluded from the occupancy total. The retailer filed for bankruptcy and stopped paying rent, though its lease runs through 2031. Despite this, Brookfield claims the property remains fully leased and continues to attract top-of-market rents.
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Long-Term Commitments and Portfolio Context
The refinancing follows Brookfield’s move to extend its ground lease for the entire 14-acre Brookfield Place complex with the Battery Park City Authority to 2119. The annual ground lease payment starts at $7M, subject to regular increases. Brookfield Place is reportedly the most valuable office asset in Brookfield Corp.’s $1T global portfolio, valued at $4B. Brookfield’s other high-profile Manhattan holdings include Manhattan West ($3.3B) and the retail condo at 730 Fifth Ave. ($1.2B).
Broader CMBS Activity in Manhattan
Office refinancing utilizing CMBS debt remains an ongoing strategy for Brookfield Corp. and Brookfield Asset Management. Recent transactions include a $1.25B CMBS deal at Five Manhattan West and $1.3B at 660 Fifth Ave., as well as a major refinancing at Hudson Yards, showcasing continued confidence in premium Manhattan office assets.
