SL Green, partnering with Caesars Entertainment for a proposed Times Square casino, is seeking an extension on a $743 million loan for 1515 Broadway. The loan enters special servicing despite the property's strong performance and full occupancy.

The property maintains stellar performance with consistent mortgage payments and generates sufficient cash flow. In late 2022, SL Green announced its partnership with Caesars Entertainment and Jay-Z's Roc Nation to develop a $4 billion casino hotel at the location.

SL Green currently manages $10.1 billion in net debt, including unconsolidated joint venture debt, with approximately $0.4 billion in excess cash and investments as of Q2 2024. The property's current interest rate sits below 4%, though refinancing could result in higher rates.

Paramount, the building's primary tenant, recently announced layoffs affecting some workers at SL Green properties. This tenant concentration, combined with Paramount's ongoing takeover battle, may influence future lending terms.

The proposed Caesars casino would occupy the current Minskoff Theater space, home to "The Lion King." New York regulators aren't expected to award downstate casino licenses until late 2025, which could affect SL Green's plans for the property.

The building's loan comes due in March, and while the special servicing status suggests potential default risk, the property's strong cash flow and leasing status indicate underlying stability. The outcome may depend on broader market conditions and the success of license applications for the proposed casino project.

Related Articles

Previous Articles