Rudin Management is taking advantage of low interest rates while they last, signing a $425 million loan to refinance its 32 Sixth Avenue office tower.
The 10-year loan, which will be sold off as commercial mortgage-backed securities, was underwritten by JPMorgan Chase and Deutsche Bank.
Rudin incurred a $26.2 million termination fee for early payment of its previous $360 million loan, which was also securitized, according to Trepp. That loan was set to expire in April 2017.
Bill Rudin, the firm’s CEO, defended the decision, saying the fee was worth locking in low rates.
“We liked where the interest-rate market is today and thought this was an opportune time to refinance on a long-term basis,” Rudin told Crain’s. “In two years from now, we think rates will be significantly higher than where they are now.”
Rudin bought the landmarked, 1.1-million-square-foot Tribeca office building, also known as the AT&T Long Distance Building, in 1999. Telecom and communications companies including Qwest Communications, Telx, Tata Communication, Dentsu Aegis and the Cambridge University Press make their home at 32 Sixth Avenue. [Crain’s] – Ariel Stulberg