What George Comfort, Loeb Partners and Jamestown want to refinance the property at 63 Madison Avenue

Why Existing debt on the building likely is near maturity

What next Newmark is advising the group on the new loan bid

A three-way partnership that owns the office building at 63 Madison Avenue in Manhattan has kicked off discussions about refinancing it with a new $542 million mortgage, Green Street News can reveal.

The ownership group – George Comfort & Sons, Loeb Partners Realty and Jamestown – is working via Newmark to arrange the debt. They are taking quotes for a five-year loan with either a fixed or a floating rate.

The collateral property totals 870,000 sq ft one block north of Madison Square Park in the NoMad neighborhood. It’s about 94% occupied, with a weighted average remaining lease term of 17 years.

The solid leasing numbers represent something of a turnaround. Around the beginning of last year, the owners considered selling an interest in the building as they sought capital to lift its occupancy from roughly 76% at the time. A few months later, Brookfield emerged as a likely investor in the property, with the Commercial Observer reporting that the injection would take the form of a preferred-equity slug as opposed to an ownership stake.

Since then, the ownership group has inked leases for 600,000 sq ft by extending existing agreements while filling the majority of the vacancy. The upshot is that the current refinancing bid comes at a time of greater stability when lenders likely will take a strong run at the loan assignment.

George Comfort and Loeb Partners, both of New York, purchased the property in 1995. They sold a 49% stake to Atlanta-based Jamestown for $509.6 million in a 2016 deal that also included a 49% interest in the building at 200 Madison Avenue.

Wells Fargo led a bank group that originated a $410 million mortgage on 63 Madison Avenue near the end of 2019. That debt, and possibly Brookfield’s investment, would stand to be retired with proceeds from the new loan.

The 15-story building, which spans Madison Avenue between East 27th and East 28th Streets, was developed in the early 1960s by New York Life Insurance as a companion for the insurer’s then-headquarters just south, at 51 Madison Avenue. It has been renovated multiple times since, with upgrades in recent years including a new lobby, improved retail space and a LEED-gold designation.

A Whole Foods grocery store opened in almost 60,000 sq ft on the lower floors nearly four years ago. New York Life still has space at the property, and retailer American Eagle Outfitters expanded its offices there to almost 400,000 sq ft last year. Others on the tenant roster include CBS and the City University of New York.