On Monday, Cove Property Group announced the closing of a $724.2 million financing from Blackstone Mortgage Trust for Hudson Commons, its trophy office redevelopment located in Manhattan’s Hudson Yards. An Eastdil Secured team led by Grant Frankel, Phil McKnight and Ethan Pond represented Cove in the deal.
“We are thrilled to provide senior mortgage financing on Hudson Commons, an outstanding property in Manhattan’s best performing submarket. This transaction exemplifies BXMT’s differentiated ability to finance large scale, high quality real estate with strong sponsorship in core locations,” said Steve Plavin, President and CEO of Blackstone Mortgage Trust.
Cove Property Group together with The Baupost Group purchased the property from Emblem Health for $330 million in December 2016. Over the past two years, under the new ownership, the eight-story, 423,000-square-foot warehouse at 441 Ninth Ave. has been completely transformed in an ambitious adaptive reuse project. The building was expanded to a 28-story, 700,000-square foot office tower, complete with coveted amenities such as 14-foot-high ceilings, terraces on nearly every level, open floor plans, and state-of-the-art technology. Rebranded Hudson Commons, the property is on track to earn a LEED Platinum certification.
“From day one, we held true to our business plan of preserving a remarkable industrial building, while adding to it an integrated, efficient tower and thereby creating a best-in-class work environment that fosters collaboration, innovation and growth, all at the gateway to Manhattan’s newest center of business,” said Kevin Hoo, Founder and Managing Partner at Cove. “Cove and Baupost are extremely proud of the finished product, which we recently launched to market, and we look to welcome new tenants into the remaining tower floors. We are pleased that Blackstone appreciates the execution of our vision, and we are excited to be partners with them in this next chapter of Hudson Commons.”
The property is currently 65% leased and anchored by Peloton, which occupies 336,000 square feet. The tenant roster also features Lyft with 100,000 square feet, and Brevet Capital Management with 16,000 square feet. According to Cove, only 213,000 square feet of office space remain available, on floors ranging from 16,000 square feet to 23,000 square feet. This includes the penthouse, which features panoramic views of the city and a private rooftop garden.