I agree. It’s a mediocre tower in a lousy location.
I’d keep an eye on it for another month…
I must write that this design is cooler and better looking than the new one, Vertical_Gotham.
should have just made the tower 666 feet tall. Would have been a hit with Satanist billionaires.
El-Gamal got hooked up with Asian and Middle Eastern money. I bet American lenders aren’t thrilled right now.
American lenders aren’t doing so well in terms of stock prices these recent quarters. I can see why they are selective to reduce risk, but its just going to push developers towards other financial institutions.
But Chinese and Middle Eastern lenders are the best. Especially Chinese. They know in the U.S. that cities are the future. Not just in NY, but in Florida, Washington State and California. Investing heavily.
Its not like this project is as risky compared to building another CPT or 220 CPS. Eh, but its there loss I guess.
Manhattan tower secures $219m in sharia-compliant financing
The financing, led by Malaysia’s Maybank and Kuwait’s Warba Bank, is the largest sharia-compliant syndicated construction loan in New York, Mr El-Gamal said, bringing to the forefront what he called “the safest kind of banking in the world”. Italy’s Intesa Sanpaolo and MASIC, the investment arm of Saudi Arabia’s Al Subeaei family, also participated in the loan package.
Sharif El-Gamal is feeling pretty damn good.
The founder and CEO of Soho Properties is fresh off a $219 million financing round that allows him to build 45 Park Place, a luxury condominium in Tribeca. It’s a scenario few saw coming: A sponsor new to the condo development game, in direct competition with blue-chip projects, at a site referred to in some circles as the “Ground Zero mosque.”
And yet El-Gamal finds himself flush at a time when many of his seasoned compatriots are struggling to convince banks that the high-end market is just fine, that concerns of oversupply are overblown, and that their projects are worth betting on.
To make it happen, he brought together banks from the Middle East, Asia and Europe in a murabaha, a type of financing structure that adheres to Islamic legal principles, or sharia. Industry experts are calling it the largest construction financing of its kind ever in New York. El-Gamal believes it will set his firm apart.
“We were able to tap into a pool of water that nobody’s in,” he told The Real Deal during an interview at his agarwood-scented office on Friday. “We saw an appetite to do something without paying extra for it.”
Murabaha, in a nutshell, works like this: The lender buys the asset, and agrees to sell it to the borrower for a pre-agreed markup (generally determined based on a benchmark such as LIBOR plus a margin). The borrower generally pays the higher price in installments, thus giving him or her immediate funds and allowing the lender to make a profit. Interest, which violates Islamic jurisprudence, is left out of the equation. And importantly, debt cannot be sold, which deters the trading of notes that is sport among New York real estate investors.
El-Gamal took issue with news reports that described the structure as “complex.”
“It’s quite simple,” he said. “And it’s the safest form of financing, because it involves a true partnership between the lender and the borrower. It’s not a ‘loan-to-own’ vehicle — it’s not a way to trap you.” He declined to specify how much the money was costing him but said he will be paying “conventional banking rates.”
A lawyer well-versed in sharia-compliant financing said it technically isn’t safer than traditional financing – except in spirit. It is rooted, he said, in the Islamic ideal of treating one’s counterpart justly: If a borrower runs into economic distress, the lender is open to working it out, rather than “jumping down your throat.”
The model is commonplace in Europe. London’s famous Shard Building was bankrolled in part by sharia-compliant financing from Qatar, and George Osborne, the U.K’s Chancellor of the Exchequer, has argued that London ought to become a hub of sharia-compliant finance to boost overseas investment.
In New York, sources noted Macklowe’s $585 million acquisition of One Wall Street was completed in part with a sharia-compliant loan from Qatar National Bank. But its use for construction financing here, at least on this scale, is unprecedented.
Construction Finally Begins on Sharif El-Gamal’s 45 Park Place
After nearly a decade in the works, construction is finally on at the site
Great that this was given the greenlight but the new design is a bit of a disappointment.
its a nice skyline addition, but definitely not a game changer. This 56 Leonard and Murray St will help fill out the area north of WTC nicely.
downtown expanding north. Between this, 56 Leonard, and the 2 bridges towers we are seeing the tall buildings drift northward.
Where should the cutoff be? I would like to preserve the effect of 2 clusters. Maybe keep Canal through 22nd or so lowrise?
I have no problem with the 2 clusters merging into one- the world’s largest.
I don’t want to see high rises between Dowtown and Madison Sq. That area is a sea of gorgeous old lowrises.
I agree, though I wouldn’t mind vertical expansions, or slim buildings with cantilevers such as 251 w 14th.
That’s a great building.