Manhattan Rental Building Lands $72M Refi

PGIM Real Estate Finance originated the Fannie Mae financing for the 240-unit Olympia House, located within two blocks of Grand Central Station.
Olympia House. Image courtesy of PGIM Real Estate Finance

A trio of real estate investors—Isaac Hakim, Steven Elghanayan and Michael-Henry Krayem—received a $72 million Fannie Mae loan to refinance Olympia House, a 240-unit apartment community located in Midtown Manhattan’s Turtle Bay neighborhood.

PGIM Real Estate Finance originated the 10-year, full term, interest-only financing utilizing Fannie Mae’s Streamlined Rate Lock execution. The firm also arranged a previous Fannie Mae loan on the property back in 2012.

“The borrower had additional term remaining on its previous loan, but started looking for refinance options a year in advance in order to take advantage of dips in long-term treasury rates and spreads,” Brian Salyards, PGIM Real Estate Finance’s principal in multifamily, told Multi-Housing News. “The client cast a very broad net in looking for the best financing available in the market. At the end of an exhaustive process, Fannie Mae was able to offer the best long-term debt options available.”

Located at the juncture of Second Avenue and 279 East 44th St., just two blocks from Grand Central Station, the 21-story Olympia House offers 108 different floorplans. The 1964-built high-rise doorman property also offers five fully occupied ground-floor commercial spaces and a parking garage.

“Olympia House is a full-service apartment complex that has been well maintained, with recently-upgraded units, and is situated in a sought-after Midtown East location proximate to Grand Central Station,”  Salyards said. “The long-term, low-leverage loan arranged by PGIM Real Estate Finance for this generationally-owned asset carries very little risk throughout varying market cycles.”

Earlier this month, PGIM Real Estate Finance originated a $164 million Fannie Mae loan for Princeton Properties to retire existing financial obligations for 14 residential properties totaling 1,620 units spread across the Boston metropolitan area and suburban New Hampshire.

A View of Manhattan’s Multifamily Market

According to Yardi Matrix’ latest Manhattan multifamily report, apartment demand remains high across the borough, where more than 3,700 units came online in 2018, representing 1.1 percent of total inventory.

Ariel Property Advisers most recent Manhattan multifamily market report revealed the first quarter of 2019 saw declines year over year, citing the political power shift that occurred in the New York State Assembly during this past November and expected impending legislation pertaining to rent regulation as factors.