Extell signs $220M construction loan for 534-key project in Midtown West

Extell Development through the entity N47 Associates LLC as borrower signed a new construction loan with lender Banco Inbursa valued at $220 million for the hotel project (H1) at 32 West 48th Street in Midtown West, Manhattan.
Extell filed plans November 20, 2020, for a 534-unit, 168,897 square-foot hotel (R-1) building, which were submitted by David Rothstein.
The loan closed on December 11, 2023 and was recorded on December 22, 2023.
The signatory for Extell Development was Gershon Barnett, who also uses the name Gary Barnett. The signatory for Banco Inbursa was Enrique Morelos-Zaragoza Borbolla.

The property

The lot is irregular. The zoning is C6-4.5 which allows for up to 12 times floor area ratio (FAR) for commercial The city-designated market value for the property in 2022 is $1.8 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have received 10 DOB violations, $4,930 in ECB penalties, and $5,780 in OATH penalties in the last year.

The neighborhood

In Midtown West, The majority, or 75 percent of the 75.9 million square feet of commercial built space are office buildings, with hotel buildings next occupying 14 percent of the space. In sales, Midtown West has the 6th highest sale turnover among other neighborhoods in the city with $2.4 billion in sales volume in the last two years. For development, Midtown West is the most active neighborhood among other neighborhoods. It had 19.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 25 percent of the neighborhood’s built space.

The block

On the tax block of 32 West 48th Street, PincusCo has identified the owners of 19 of the 35 commercial properties representing 1,122,002 square feet of the 1,866,158 square feet. The largest owner is United Overseas Bank, followed by Sunkar Satvaldiyev and then Stawski Partners.
On the tax block, there were two new building construction projects totaling 227,777 square feet. The largest is a 534-unit, 168,897 square-foot hotel/dormitory/shelter (R-1) building submitted by Extell Development and filed by David Rothstein with plans filed November 20, 2020 and permitted December 28, 2022. The second largest is a 58,880 square-foot mercantile (M) building submitted by Michael Mcmenamin with plans filed June 1, 2016 and it has not been permitted yet.

The majority, or 87 percent of the 1.9 million square feet of built space are office buildings, with retail buildings next occupying 10 percent of the space.

The borrower

The PincusCo database currently indicates that Extell Development owned at least 65 commercial properties with 773 residential units in New York City with 2,830,410 square feet and a city-determined market value of $748.6 million. (Market value is typically about 50% of actual value.) The portfolio has $5.7 billion in debt, with top three lenders as Guggenheim Partners, Blackstone Group, and Prudential Credit Opportunities respectively. Within the portfolio, the bulk, or 38 percent of the 2,830,410 square feet of built space are specialty properties, with elevator properties next occupying 28 percent of the space. The bulk, or 96 percent of the built space, is in Manhattan, with Brooklyn next at 4 percent of the space.

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