Ceruzzi Properties Lands $350M Loan for Manhattan Tower
- Feb 21, 2020
South Korea’s Meritz Securities has provided $350 million in financing for The Centrale, a new luxury condo tower developed by Ceruzzi Properties and SMI USA in Midtown Manhattan. The inventory loan replaces the previous $300 million construction loan that Madison Realty Capital provided to Ceruzzi in 2017.
Completed early last year, the 63-floor tower provides 124 luxury condo units at 138 E. 50th St., several blocks north of Grand Central Terminal. The more than 800-foot-tall building also includes 7,645 square feet of retail space at and below ground level and a 25-space parking garage.
VI Development Group, helmed by Terence Park, advised Meritz on the financing deal and brought in PIA Asset Management as the project’s asset management firm. JLL represented Ceruzzi exclusively in the transaction.
“The inventory loan was to facilitate additional term to sell out the building and improve economics for the Sponsor,” JLL Managing Director Chris Peck said in a statement to Multi-Housing News.
Inventory loans are typically used to pay off maturing construction loans while holding unsold units for a longer time period than anticipated. Ceruzzi launched sales at The Central in April 2019 and has entered 20 units into hard contract so far.
Madison Realty Capital, which is exiting its investment in the project, said in a statement that the new financing marks the first inventory loan provided by a Korean firm in New York City.
The Centrale features a mix of layouts ranging in size from one to five bedrooms and from 777 to 5,288 square feet. Amenities of the building include an indoor pool and spa, fitness center and shared workspaces. The property sports a façade designed by Pelli Clarke Pelli Architects, with interiors by Champalimaud Design.
Located between Third and Lexington Avenues in Midtown East’s Plaza District, the property has quick access to Times Square and Bryant Park. Commercial and residential developer Ceruzzi acquired the site from Extell Development in 2013 and originally planned to build a 52-story hotel with 764 guestrooms.
The company later teamed up with SMI USA, an offshoot of Shanghai government-owned SMI Group, to develop the condo project. Elsewhere in Midtown, SMI USA partnered with Extell to co-develop Central Park Tower, the world’s tallest residential building.
Meritz Securities, a Seoul-based securities and financial services firm, has been raising its profile in overseas real estate markets amid a wave of Korean cross-border investment. Last year, the company joined a team of South Korean investors to buy the Hilton Parkview hotel in Vienna, the largest hotel in Austria, for €370 million ($414 million).
In November, The Korea Economic Daily reported that Meritz had ventured into India’s residential market by committing $425 million to a housing finance platform in the country.