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Vornado gets $500M from preferred equity redemption in NYC property

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Vornado gets $500M from preferred equity redemption in NYC property

Vornado Realty Trust received $500 million from the redemption of its preferred equity in 640 Fifth Ave., which was part of a portfolio of New York City high-street retail properties in which the company recently sold a 45.4% common equity interest.

The office landlord said the preferred equity was redeemed from the proceeds of a $500 million, five-year, interest-only mortgage loan on the property. The loan bears interest at the London interbank offered rate plus 1.01%, which was swapped for four years to a 3.07% fixed rate.

Separately, the real estate investment trust said it closed on an extension of a $375 million loan on the 886,000-square-foot 888 Seventh Ave. office building in Manhattan, N.Y.

The new amortizing loan matures in December 2025 and bears interest at Libor plus 1.70%, fixed at 3.25% through December 2020.