IDB Holding Corp. Ltd. (TASE:IDBH) unit Property and Building Ltd. (TASE: PTBL) has signed a non-binding term sheet for $400 million in refinancing the US headquarters of HSBC bank in Manhattan for ten years. The company expects to close the deal with a foreign bank by the end of the month.
The new financing is secured by a lien on Property and Building on the property and other guarantees. The current financing on the property is $240 million.
The 863,000-square foot complex comprises three buildings, including a 29-storey high-rise at 452 Fifth Avenue in Midtown. Property and Building and Koor Industries Ltd. (TASE:KOR) bought the property in equal shares in October 2009 in a buy and lease-back deal with HSBC Holding plc (LSE: HSBA; HKSE: 005; NYSE, Paris: HBC) for $353 million. The deal was closed in April 2010. Last year, Koor sold its stake in the property to Property and Building for $138 million. CB Richard Ellis valued the property at $480 million at the time.
Property and Building CEO Sagi Eitan said that the company completed the leasing of 244,000 square feet in the HSBC building over the past year to tier-1 tenants in long-term contracts. The tenants include the Man Group plc (LSE: EMG) and the Baker & McKenzie law firm.
Property and Building's share price rose 1.1% by midday today to NIS 127, giving a market cap of NIS 799 million.
Published by Globes [online], Israel business news - www.globes-online.com - on June 10, 2012
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