Melohn Group, Safehold, sign $167M refi for ground leased fee in FiDi, down from $175M

Leon Melohn’s Melohn Group and partner Safehold Inc. through the entities 32 Slipstream LLC and 32 Old Stream LLC as borrowers signed a refi loan with lender Goldman Sachs, Barclays, and Morgan Stanley valued at $167 million for the ground leased fee under the office building (O4) at 32 Old Slip also known as 77 Front Street in the Financial District, Manhattan.
The deal closed on May 5, 2025 and was recorded on May 12, 2025. The prior lender was Series 2015-C23 which held debt that had an original loan amount of $175 million.

The property has 973,587 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $171 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 signatory for Safehold Inc. and Melohn Group was Leon Melohn . The signatory for Goldman Sachs , Barclays , and Morgan Stanley was Suraj Dash .
The Commercial Observer first reported on the refinance.

On April 13, 2015, Melohn paid $197.5 million to Beacon Capital Partners for the ground leased fee. On the same day, RXR Realty bought the ground lease for $477.5 million.

The 2015 loan analysis notes that Melohn paid a $10 million sales broker commission as part of the purchase, according to the loan prospectus. Then 2021, Melohn sold an approximately 30 percent stake in the fee for $90.5 million to Safehold.

The original loan was packaged into the securitized trust Series 2015-C23. According to the 2015 prospectus, “The Ground Tenant is required to pay ground rent in the amount of $8,500,000, annually, on an absolute net basis, for the initial 10 years of the Ground Lease. The ground rent contractually increases to $9,572,381 beginning in the 11th year and then increases by 2% annually thereafter…

“The borrowers are 32 Slipstream, LLC (TIC 1) and 32 Old Stream, LLC (TIC 2), two single-purpose Delaware limited liability companies that own 61.04% and 38.96%, respectively…The proceeds of the 32 Old Slip Fee Loan Pair were used to acquire the 32 Old Slip Fee Property for a purchase price of approximately $207,500,000, including a $10,000,000 brokerage fee.”

Leon Melohn controls all of 32 Slipstream, LLC (TIC 1). Safehold contols 74.99% of 32 Old Stream, LLC (TIC 2) through 32 Old Stream Member LLC, while Leon Melohn controls 25.01% of 32 Old Stream, LLC through 32 TIC 2 LLC. Resulting that Leon Melohn owns about 70% of the fee and Safehold owns about 30% of the fee.

Prior sales and revenue

The 973,587-square-foot property generated revenue of $66.6 million or $68 per square foot, according to the most recent income and expense figures.

The property

The office building in Financial District has 973,587 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 216 feet and is 203 feet deep with a total lot size of 42,176 square feet. The lot is irregular. The zoning is C6-9 which allows for up to 15 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 $272.3 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received $12,300 in ECB penalties and $12,900 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial certificate of occupancy on October 29, 2018. There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Financial District, The majority, or 74 percent of the 79.9 million square feet of commercial built space are office buildings, with elevator buildings next occupying 15 percent of the space. In sales, Financial District has the 5th highest sale turnover among other neighborhoods in the city with $1.8 billion in sales volume in the last two years. For development, Financial District is the 3rd most active neighborhood among other neighborhoods. It had 13.8 million square feet of commercial and multi-family construction under development in the last two years, which represents 17 percent of the neighborhood’s built space. There were three pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of two of the two commercial properties representing 1,963,837 square feet of the 1,963,837 square feet. The two identified owners are Rxr Realty and Intervest Capital Partners.
There are no active new building construction projects on this tax block.

All properties are office.

The borrower

The PincusCo database currently indicates that Safehold Inc. owned at least one commercial property with 111 residential units in New York City with 109,795 square feet and a city-determined market value of $45.1 million. (Market value is typically about 50% of actual value.) The portfolio has $20.6 million in debt, borrowed from John Hancock Life Insurance. The portfolio consists of at least a single elevator property. It is located in Manhattan.

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