Credit Suisse buys stake in Park Avenue building.SL Green Realty Corp. announced that Credit Suisse First Boston Credit Suisse First Boston was originally the trading name of the Financière Crédit Suisse-First Boston, a London-based 50-50 investment banking joint venture formed in 1978 between the First Boston Corporation and Credit Suisse. LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , through a wholly owned affiliate, acquired a 75% interest in One Park Ave. The interest was acquired from a joint venture comprised of SL Green Realty Corp. and SITQ, Inc. Simultaneous with the closing of the acquisition, the new joint venture completed a refinancing Refinancing An extension and/or increase in amount of existing debt. of the property with Column Financial, Inc., which is also an affiliate of Credit Suisse First Boston. Credit Suisse The Credit Suisse Group (SWX:CSGN, NYSE: CS) is a financial services company, headquartered in Zürich, Switzerland. It is the second-largest Swiss bank, behind UBS AG. First Boston's affiliated entity acquired its equity interest for $60 million. The acquisition was based on a total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. of approximately $318.5 million, or $344 per s/f. The cash NOI NOI Net Operating Income NOI Notice of Intent NOI Nation of Islam NOI Notice of Inquiry NOI Neuro Orthopaedic Institute NOI New Organizing Institute NOI Notice of Interest NOI No Offense Intended NOI National Olympiad in Informatics cap rate based on the total capitalization is 6.4%. The $238.5 million 10-year interest only loan, funded by Column Financial, bears interest at a fixed rate of 5.8% and replaced the existing $150 million floating rate loan which was scheduled to mature in January, 2005. The company received $83 million in net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from the re-capitalization, or $28 million in excess of its investment in the pre-existing joint venture. Net proceeds, which were used to pay down the company's unsecured line of credit, included an approximately $4.3 million incentive fee earned pursuant to the prior joint venture agreement with SITQ. The company has retained a 16.7% interest in the new venture, which may be increased substantially based upon the financial performance of the property. The company will manage the venture, in addition to continuing its responsibility of leasing and managing the property. It will also account for the transaction as a sale of interests and recognize a gain on sale of approximately $22 million. The company's initial book basis in the new joint venture will be approximately $4 million and it will be accounted for under the equity method. "The re-capitalization of One Park Ave. is a great example of how SL Green creates and unlocks value for our shareholders," said Marc Holliday, the company's president and chief executive officer. "We were able to realize a significant gain upon the conclusion of our re-tenanting program, while maintaining our ability to meaningfully participate in the future upside potential Upside potential The amount by which analysts or investors expect the price of a security may increase. upside potential The potential price or gain that may be expected in a security or in a security average, generally stated as the dollar of the property. This transaction also enabled us to strengthen our balance sheet by paying down our floating rate debt. Additionally, we are excited to have Credit Suisse First Boston join our group of high quality joint venture partners." Woody Heller, executive managing director of Studley's capital transactions group, represented SL Green and SITQ in the sale of its interest. |
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