Hudson’s Bay Company Announces $1.25 Billion CMBS Financing

November 25, 2014

Financing deal secured by Willkie client HBC’s flagship Saks Fifth Avenue store property in New York City. 

On November 24, Willkie client Hudson’s Bay Company announced that it has leveraged the value of its largest real estate asset, announcing a $1.25-billion CMBS financing deal secured by its flagship Saks Fifth Avenue store property in New York City.  The 20-year mortgage loan is based on an independent appraiser’s assessment of the property’s value at $3.7 billion, significantly more than what HBC paid for all of Saks & Co. portfolio of stores when it acquired the company last year.

The transaction with Bank of America, N.A., Morgan Stanley Bank, N.A., Goldman Sachs Mortgage Co. and Bank of Nova Scotia is expected to close in early December.  Proceeds from the transaction will be used to pay down corporate-level debt and to fund an approximately $250 million renovation of the Saks flagship, beginning in 2015.

Hudson’s Bay Company, founded in 1670, is North America’s longest continually operated company. Its luxury retailer subsidiary Saks & Co. currently operates 41 Saks Fifth Avenue stores and 67 Saks Fifth Avenue OFF 5TH stores throughout the United States and its online store, saks.com. Saks Fifth Avenue OFF 5TH is a world-class, full-service destination for value-priced clothes and accessories for men, women, children and the home.

The transaction is being handled by partners Thomas Henry and Henry Cohn, and associates Michael Jackowitz, Timothy DeKeyser and Natalie Whitaker.