Finance  ·  CMBS

CMBS Loan Securing Former American Express Building Hits Special Servicing


A $151.5 million commercial mortgage-backed securities (CMBS) loan backing a Class B office property at 65 Broadway in Lower Manhattan, which has faced a steady leasing footprint decline since the COVID-19 pandemic, has entered special servicing ahead of its April 2024 maturity date, according to a report from Morningstar

The five-year, interest-only loan on the former American Express Building, which became  part of the CF 2019-CF1 and MSC 2019-H6 conduit CMBS deals in April 2019, was originated by CCRE at a fixed 4.94 percent interest rate. 

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The 1917-built, 355,000-square-foot tower co-owned by the Chetrit Group and Read Property Group saw its net cash flow fall 15 percent below issuance levels in 2022, pushing the debt service coverage ratio to below break even at 1.02 times, according to Morningstar. 

Sarah Helwig, vice president at Morningstar, said the borrowers have requested a loan modification from its special servicer, CWCapital Asset Management. The 21-story building’s revenue struggles are largely driven by a steep drop in leasing occupancy, which was 67 percent as of September 2023 compared to 75 percent in December 2022 and 99 percent at the time the loan was originated. 

“This property has many small tenants, and as their leases have been coming up they’ve been leaving, and there is more rollover in the coming year,” Helwig said. “There is less demand overall for older New York Class B buildings and we’ve seen that more and more, especially as the pandemic has ended and companies leave those spaces by either reducing their footprint or trading up to higher-quality spaces.”

The biggest tenant loss at 65 Broadway involved Great American Insurance, which leased about 6 percent of the building before departing in May 2020, according to Helwig. Nonprofit New York Cares also departed in June 2023, relocating its headquarters to nearby 39 Broadway after accounting for 5 percent of the property.

Helwig noted that most of the existing tenants take up small spaces in the building, with none accounting for more than 5 percent. The biggest tenant is workforce development services company Arbor E&T, which has a lease that runs until 2929. 

Chetrit and Read assumed ownership of 65 Broadway in 2015 before spending $16.7 million to renovate the lobby and upgrade office spaces, Commercial Observer previously reported. The building was previously the headquarters for American Express until 1975 and later Standard & Poor’s (now called S&P Global Ratings). 

Chetrit and Read did not immediately return requests for comment.

Andrew Coen can be reached at 




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