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Greystone Arranges $550M Freddie Mac Loan for Sky Residences in Manhattan

NEW YORK CITY — Greystone has closed a $550 million permanent Freddie Mac loan made to joint venture partners The Moinian Group and SL Green Realty Corp. for Sky Residences in Manhattan. The Greystone Bassuk debt advisory team, led by Richard Bassuk and Drew Fletcher, represented the borrower. The transaction marks the largest-ever single-asset tax-exempt financing completed by Freddie Mac and a first-of-its-kind private placement structure that includes permanent financing for hundreds of affordable housing units in New York City. Steve Rosenberg, Billy Posey, Joe Mosley, and Jeff Englund of Greystone collaborated with Freddie Mac on the structure for Moinian and SL Green, and spearheaded the loan process for Greystone.

Sky Residences, located at 605 West 42nd Street, is one of New York City’s iconic luxury rental buildings with 1,175 units and 70,000 square feet of amenity space in a 71-story tower. The property was developed by Moinian and designed by Rockwell Group. Amenities include an exclusive multi-level fitness club; water club; spa; lap pool; NBA regulation-size basketball court; two outdoor pools; café; kids’ club; and a private outdoor park design by Thomas Balsley. The property is the largest single-tower residential building in the United States, with 25 percent of its units designated as moderate and affordable housing. Lifetime Fitness, Volvo and Icon Parking occupy commercial space, and the property also includes an onsite parking garage. The project is utilizing 4 percent Low Income Housing Tax Credits and both tax-exempt and taxable variable rate bonds issued by New York State Housing Finance Agency (HFA).

The Freddie Mac loan completes an exit from the original construction financing provided by Bank of China and Union Labor Life Insurance Company in 2014. The permanent loan was structured as a direct purchase by Freddie Mac of the HFA bonds with a pre-stabilized funding and early spread lock. Freddie Mac completed the direct purchase of the bonds with plans to securitize the bonds in a single-asset securitization, a first-of-its-kind structure that provided certainty of execution while also delivering pricing far below a standard bond credit enhancement. The structure was put in place under the Affordable New York Housing Program, the city’s revamped 421-a tax abatement program.

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