Empire State Realty Secures $715M Credit Facility

Empire State Realty Trust (ESRT) has successfully secured a significant financing package totaling $715 million. The package comprises a $620 million revolving credit facility and a $95 million term loan facility, both with a maturity date set for March 2029.

Flexible Maturity Dates and Extension Periods

The revolving credit facility provides flexibility with two optional six-month extension periods, while the term loan facility includes two 12-month extension periods. This financing replaces a previous credit facility obtained in 2021, which had an initial maturity of March 2025.

Sustainability-linked Pricing Mechanism

Similar to the prior deal, the new credit agreement incorporates a sustainability-linked pricing mechanism. This feature ties borrowing spread reductions to the achievement of certain sustainability benchmarks annually.

Key Players in the Financing

BofA Securities Inc. and Wells Fargo Securities LLC acted as joint bookrunners for the transaction. Bank of America serves as the sustainability structuring agent and administrative agent. JPMorgan Chase Bank N.A. and U.S. Bank National Association are the joint lead arrangers, with U.S. Bank National Association also serving as the documentation agent. Additionally, Bank of Montreal and Goldman Sachs Bank USA are the senior managing agents.

Leadership Changes at ESRT

ESRT recently underwent notable leadership changes, with Christina Chiu promoted to president and Stephen Horn assuming the role of executive vice president, chief financial officer & chief accounting officer.

Portfolio and Recent Leasing Activity

ESRT's portfolio comprises approximately 8.6 million rentable square feet of office space, along with retail and residential units. Noteworthy recent leasing activities include Greater New York Mutual leasing a floor at the Empire State Building, a lease expansion at 1400 Broadway, and agreements with Burlington Stores Inc. and Sol de Janeiro.

Manhattan Office Market Overview

As of February, Manhattan's office vacancy rate was 16.5 percent, reflecting a 100-basis-point decrease over the previous 12 months, according to a CommercialEdge report.