Chetrit Group signs $120.5M refi loan with Mack Real Estate Group for hotel in Times Square

Chetrit Group through the entity 250 West 43 Owner Iii LLC as borrower signed a refi loan with lender Mack Real Estate Group through the entity CMTG Lender 99 LLC valued at $120.5 million for the hotel building (H3) at 250 West 43rd Street in Times Square, Manhattan.
The deal closed on August 1, 2022 and was recorded on August 29, 2022. The prior lender was JPMorgan Chase which held debt that had an original loan amount of $129 million. The property has 238,818 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $504 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The owner bought the property on January 22, 2015, for $191.8 million. The signatory for Chetrit Group was Meyer Chetrit. The signatory for Mack Real Estate Group was Priyanka Garg.

Prior sales and revenue

The owners according to the Department of Housing Preservation and Development includes Meyer Chetrit, head officer and Lilly Sirkin, agent. The business entity is 250 West 43 Owner Llc.

The property

The 250 West 43rd Street parcel has frontage of 145 feet and is 100 feet deep with a total lot size of 14,500 square feet. The zoning is C6-5 which allows for up to 10 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $28.5 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received 13 DOB violations and $1,200 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial certificate of occupancy on March 7, 2013. On these lots, there is one active major alteration construction project for a 584-unit, 209,139-square-foot R-1 building. The project was developed by Meyer Chetrit with plans filed March 17, 2017 and it has not been permitted yet.

The neighborhood

In Times Square, the majority, or 58 percent of the 10 million square feet of commercial built space are office buildings, with hotel buildings next occupying 30 percent of the space. In sales, Times Square has had very little sales volume relative to other neighborhoods with $85.1 million in sales volume in the last two years. For development, Times Square has 1.9 times the average amount of major developments relative to other neighborhoods and is the 15th highest in Manhattan. It had 2 million square feet of commercial and multi-family construction under development in the last two years, which represents 20 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of two of the 10 commercial properties representing 1,005,000 square feet of the 2,178,824 square feet. The two identified owners are Rudin Management Company and Tishman.
There is one active new building construction project totaling 34,313 square feet. It is a 34,313-square-foot M building developed by Jhaelen Hernandez-Eli with plans filed January 27, 2020 and it has not been permitted yet.

The majority, or 43 percent of the 2.2 million square feet of built space are hotel buildings, with office buildings next occupying 39 percent of the space.

The borrower

The PincusCo database currently indicates that Chetrit Group owned at least 31 commercial properties in New York City with 3,618,681 square feet and a city-determined market value of $671 million. (Market value is typically about 50% of actual value.) The portfolio has $1.6 billion in debt, with top three lenders as Starwood Mortgage Capital, Bank of Montreal, and Starwood Capital Group respectively. Within the portfolio, the bulk, or 35 percent of the 3,618,681 square feet of built space are office properties, with elevator properties next occupying 25 percent of the space. The bulk, or 61 percent of the built space, is in Manhattan, with Queens next at 34 percent of the space.

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