RFR Holding signs $120M refi loan with Aareal Capital for hotel in Hell’s Kitchen
RFR Holding through the entity Becker-Paramount Fee LLC as borrower signed a refi loan with lender Aareal Capital valued at $120 million for the hotel building (H2) at 235 West 46th Street in Hell’s Kitchen, Manhattan.
The deal closed on December 29, 2022 and was recorded on January 5, 2023. The prior lender was Aareal Capital which held debt that had an original loan amount of $140 million.The property has 215,879 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $555 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 July 7, 2004, for $92.7 million. The signatory for RFR Holding was Richard Froom. The signatory for Aareal Capital was Anthony J. Tuffy and Jeffrey Pascale. The original loan of $140 million given in 2018 was reduced to $120 million.
Prior sales and revenue
The owners according to the Department of Housing Preservation and Development includes Aby Rosen, head officer and Joe Kavanagh, agent. The business entities are Generator Hostels Ltd and Becker Paramount Fee Llc.
The property
The 235 West 46th Street parcel has frontage of 150 feet and is 100 feet deep with a total lot size of 15,062 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 $75.1 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 $1,337 in OATH penalties in the last year.
Development
There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.
The neighborhood
In Hell’s Kitchen, the bulk, or 39 percent of the 41.7 million square feet of commercial built space are elevator buildings, with specialty buildings next occupying 17 percent of the space. In sales, Hell’s Kitchen has 3.9 times the average sales volume among other neighborhoods with $1.4 billion in sales volume in the last two years and is the 9th highest in Manhattan. For development, Hell’s Kitchen has 3.5 times the average amount of major developments relative to other neighborhoods and is the 7th highest in Manhattan. It had 3.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 9 percent of the neighborhood’s built space.
The block
On this tax block, PincusCo has identified the owners of five of the 21 commercial properties representing 526,124 square feet of the 1,220,527 square feet. The largest owner is Triumph Hotels, followed by Raizada S. Vaid and then McSam Hotel Group.
On the tax block, there was one new building construction project filed totaling 48,726 square feet. It is a 159-unit, 48,726-square-foot R-1 building developed by Andrew Roufail with plans filed June 28, 2019 and permitted October 3, 2019.
The majority, or 78 percent of the 866,352 square feet of built space are hotel buildings, with retail buildings next occupying 9 percent of the space.
The borrower
The PincusCo database currently indicates that RFR Holding owned at least 15 commercial properties in New York City with 2,829,885 square feet and a city-determined market value of $1.1 billion. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 90 percent of the 2,829,885 square feet of built space are office properties, with hotel properties next occupying 7 percent of the space. They are all located in Manhattan.
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