Sioni Group signs $40M refi loan with Wells Fargo for office in Garment District

Sioni Group through the entity 240 W 40 LLC as borrower signed a refi loan with lender Wells Fargo through the entity Wells Fargo Bank, National Association valued at $40 million for the office building (O6) at 240 West 40th Street in Garment District, Manhattan.
The deal closed on November 27, 2024 and was recorded on December 12, 2024. The prior lender was Blackstone Group which held debt that had an original loan amount of $62 million.The property has 137,199 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $291 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 11, 2018, for $105 million. The signatory for Sioni Group was Payman Yadidi. The signatory for Wells Fargo was John G. Nicol.

The property

The office building in Garment District has 137,199 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 118 feet and is 98 feet deep with a total lot size of 11,625 square feet. The zoning is M1-6 which allows for up to 10 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $55.8 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 $1,250 in ECB penalties and $9,150 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 $1 million on this tax lot.

The neighborhood

In Garment District, The majority, or 69 percent of the 52.3 million square feet of commercial built space are office buildings, with hotel buildings next occupying 13 percent of the space. In sales, Garment District has 3.6 times the average sales volume among other neighborhoods with $925.7 million in sales volume in the last two years and is the 10th highest in Manhattan. For development, Garment District is the 5th most active neighborhood among other neighborhoods. It had 7.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 14 percent of the neighborhood’s built space. There were four 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 nine of the 23 commercial properties representing 826,971 square feet of the 1,803,020 square feet. The largest owner is Sioni Group, followed by Adler Group and then Oto Development.
There are no active new building construction projects on this tax block.

The majority, or 87 percent of the 1.8 million square feet of built space are office buildings, with hotel buildings next occupying 7 percent of the space.

The borrower

The PincusCo database currently indicates that Sioni Group owned at least seven commercial properties in New York City with 596,951 square feet and a city-determined market value of $185.6 million. (Market value is typically about 50% of actual value.) The portfolio has $116.3 million in debt, borrowed from Signature Bank and Valley National Bank. Within the portfolio, the bulk, or 100 percent of the 596,951 square feet of built space are office properties, with specialty properties next occupying 0 percent of the space. They are all located in Manhattan.

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