Vornado Gets $192 Mln And 49.9% Interest In 85 Tenth Avenue

(RTTNews) - Vornado Realty Trust (VNO) said that the entity that owns 85 Tenth Avenue has completed a $625 million refinancing of the property. The indebtedness matures in December 2026 and has a weighted average interest rate of 4.55%.

Out of the proceeds of the refinancing, Vornado received $192 million in repayment of its loans to the entity. In 2007, Vornado made $50 million of 11% PIK mezzanine loans to the entity and in 2013 and 2014 funded an additional $23 million bringing its total investment to $73 million.

In connection with its initial investment, Vornado received the right to a 49.9% interest in the entity upon repayment of the mezzanine loans. Accordingly, Vornado now owns a 49.9% interest in the entity that owns 85 Tenth Avenue.

In conjunction with the repayment, in the fourth quarter Vornado will recognize a financial statement gain of about $161 million and no tax gain.