The source said the loans were performing and that the $3.75 billion public real estate company wasn’t willing to sell the debt at a discount. SL Green has hired a sales team from Newmark Knight Frank, led by executives Dustin Stolly and Jordan Roeschlaub, to help it sell the debt. 

The sale comes as several lenders in the real estate market have experienced tumult in recent days as the pandemic crisis has filtered into the real estate financing market. The source stressed that SL Green wasn’t in this bucket of distressed lenders and concurred with the company’s position that it was seeking to selectively liquidate assets to raise money as part of the normal course of its business, including buying back stock while it feels the shares are trading at a sharply discounted value. 

On Thursday, SL Green shares were around $48, precipitously down from as high as $95 in February.

SL Green is one of the city’s largest commercial landlords, with a controlling stake in high profile properties such as the Graybar Building and the soaring new midtown office tower One Vanderbilt. In addition to its real estate holdings, the company holds a portfolio of about $1.7 billion of real estate loans, according to its financial filings, largely tied to city properties. 

That book of debt has shown small cracks, including deals that recently resulted in modest losses for the company. 

SL Green for instance, held a $15 million junior mezzanine loan against a large retail condominium at 229 W. 43rd St. in Times Square that may have recently been wiped out. 

That condo is owned by Kushner Companies, the family real estate firm of White House advisor and President Donald Trump’s son in law, Jared Kushner. Earlier this week, Crain’s revealed Kushner hasn’t paid its March mortgage payment and may default on the property. 

SL Green told Crain’s in a previous statement that it recently sold off that debt.

People familiar with the retail condo’s financial situation said that the value of SL Green’s loan had likely been wiped out, resulting in a loss for the firm in that sale. In a recent financial statement, SL Green disclosed it also took control of a distressed retail space at 106 Spring St. in Soho after its owners defaulted on a mezzanine loan it had issued at the property.

The real estate titan suffered another recent setback in its effort to raise cash. Yesterday, it was reported by the Wall Street Journal that an $815 million deal to sell a large office building on East 42nd Street had fallen through as financing for large real estate acquisitions has become scarce amid the coronavirus crisis.  
 





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