RPW Group Nabs Extension On 800 Westchester Office Loan

RPW Group nabbed a loan modification for a striking Westchester County office property, in a sign that special servicers are still doling out second chances to long-term owners, and particularly those of trophy assets.

After eight months of negotiations with special servicer Rialto Capital Advisors, Westchester-based RPW secured three more years to pay off the $110 million mortgage tied to 760 and 800 Westchester Avenue, a sprawling office complex in Rye Brook, New York.

Iron Hound Management’s Christopher Herron and Anthony D’Amelio worked on the borrower’s behalf after RPW fell delinquent ahead of the loan’s November maturity. RPW committed additional equity to lock down the terms, Herron said.

760 Westchester is a typical office-park asset: Class-B, low-rise and last renovated in 1997. That is, the type of property that might make special servicers hesitate in workouts talks.

As in neighboring New York City, older buildings in Westchester are pulling fewer tenants than their Class-A counterparts, a critical distinction in a county that reported 146,000 square feet of negative net absorption in the third quarter, according to Colliers.

Luckily for RPW, the loan was also backed by 800 Westchester, which is a Class-A behemoth in contrast with its neighbor.

The 45-year old post-modern building, described in Morningstar servicer commentary as the “premier” office property in Westchester County, has also been called an “Aztec temple,” an “aluminum business palace” and the “Starship Enterprise.”

Built as the General Foods headquarters, the 500,000-square-foot property is stocked with amenities, including a hair salon, barber and television studio. The building, itself, nabbed a cameo in the award-winning TV show Mr. Robot.

And yet, occupancy at the end of last year had slipped from 86 percent in December 2022 to 78 percent, and revenue struggled to cover mortgage payments.

The loan extension signals Rialto has faith in RPW’s ability to fill those voids — the extra equity will ensure the property has the capital to “handle all future leasing … needs,” Iron Hound’s Herron said.

It’s likely the property’s historical significance and Class A quality that fostered that confidence, as did RPW’s decades-long commitment to the deal.

“800 Westchester Avenue is an outstanding asset that has been in our portfolio for 20 years and we are proud to continue to own,” RPW President Andrew Weisz said in a statement.

RPW has a penchant for Westchester office buildings built for food companies. It paid $36 million in 2019 for a Purchase, New York, property that housed Nestle in the 80s.

It also owns the landmarked 275 Madison Avenue in Murray Hill.