$25,000,000 credit facility for a full-service, luxury cooperative building on Manhattan’s Upper East Side

Winter & Company has arranged and closed a $25,000,000 credit facility for a full-service, luxury Park Avenue cooperative building on Manhattan’s Upper East Side.

We structured a financing package which includes a $20 million, interest-only underlying mortgage, along with a $5,000,000 unsecured, revolving line of credit for this 21-story, 98-unit building. The 3.33% interest rate was locked for 90 days upon signing the term sheet, during a period of great market volatility which saw the Federal Reserve raise interest rates twice, in between the acceptance of the term sheet and the loan closing. The lender held the agreed upon rate, even though between rate lock and closing, the rate on the 10-year Treasury Note increased by more than a full percentage point (approximately 106 basis points). Up to 10% of the mortgage balance can be prepaid once per year without any pre-payment penalty, which was a very important consideration for this co-op board. The lender will not escrow for real estate taxes and will not charge any annual maintenance fees or non-use fees for the unsecured, revolving line of credit.

Unusually, this luxury cooperative building had never previously had an underlying mortgage, but as they were now planning a series of extensive capital improvements, as well as preparing to comply with recent York City environmental and energy requirements, the co-op board engaged an engineering firm to assess the condition of the building and to confirm the necessary budget, so the board could fine-tune the loan amount accordingly. As often happens, the engineering firm will also help the co-op by overseeing the work once it begins.