HOUSTON — JLL has secured a total of $450 million of financing for Prime Asset Management to recapitalize JPMorgan Chase Tower and Chase Center, two Class A office properties located in downtown Houston.
The 75-story Chase Tower is Houston’s tallest building at 1,002 feet. Combined with the 20-story Chase Center, the complex totals 2.4 million square feet. An underground pedestrian tunnel connects the buildings. Chase Tower includes office space, retail and a sky lobby observation deck. Chase Center includes office and retail space along with a parking garage.
Chase Tower is located at 600 Travis St. and was built in 1981. Chase Center is a shorter building adjacent to Chase Tower at 601 Travis St.
MetLife provided a fixed-rate senior mortgage, while JPMorgan provided mezzanine financing for a term of 11 years. The mezzanine loan has a floating interest rate for the first year and then converts to a fixed rate for the following 10 years.
Prime Asset Management, an international investment group that owns the two properties, will partially use the loans to replace its existing senior mortgage debt with MetLife, which was due at the end of 2017, according to the Houston Chronicle.
Tom Melody and John Ream led the JLL team on the transaction.
“Locking in a senior loan at today’s low interest rate lowers the owner’s cost of capital and ensures that two of downtown Houston’s most prominent office buildings will continue to perform at a high level,” says Melody. “In addition, the long-term mezzanine debt we secured demonstrates lenders’ confidence in the market’s office sector.”
The amount borrowed represents less than 70 percent of the combined value of the two buildings, according to JLL.
— Haisten Willis