Alexander’s, Inc. (NYSE: ALX), a New York City-focused real estate investment trust, has successfully restructured a significant $300 million mortgage loan on its prime retail condominium located at 731 Lexington Avenue. This strategic move not only extends the maturity of the debt but also introduces a more complex financing structure designed to manage capital expenditures and leasing costs.
The original loan has been bifurcated into two distinct notes: a $132.5 million senior A-Note carrying a 7.00% annual interest rate and a $167.5 million junior C-Note with a 4.55% annual interest rate. The newly established maturity date for this restructured debt is December 23, 2035, providing Alexander’s with long-term financial stability for this key asset.
In a pivotal move at the closing of the restructuring, an affiliate of Alexander’s acquired the $132.5 million senior A-Note at par value. This in-house acquisition signals a degree of confidence from the company in the underlying asset and its ability to service this debt.
Furthermore, Alexander’s affiliate has also entered into a new B-Note arrangement. This B-Note is earmarked to fund crucial capital improvements and re-leasing expenses, as well as to cover interest payments on the A-Note. The interest accrual on the B-Note is structured with a tiered approach: it generally accrues at a substantial 13.5% per annum. However, any portion of the B-Note exceeding $65 million that is specifically allocated to servicing the A-Note interest will accrue at a lower rate of 7.00%. This intricate structure suggests a deliberate effort to manage cash flow and cost of capital, prioritizing the servicing of the senior debt while still accommodating necessary operational expenditures.
This refinancing marks a significant financial maneuver for Alexander’s, reflecting a proactive approach to managing its debt obligations on a high-value Manhattan property. The REIT, which owns five properties in New York City, is clearly focused on optimizing its capital structure to support ongoing operations and potential future growth. Investors will be closely watching how this new debt structure impacts the company’s financial performance and its ability to navigate the dynamic real estate market.
Further details regarding the specific terms of this restructuring and the precise payment waterfall mechanism are available in Alexander’s Form 8-K filing with the Securities and Exchange Commission, dated December 29, 2025.
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