Northwind Group Provides a $135 Million First-Mortgage Acquisition Loan Secured by the Fee Interest in 235 East 42nd Street, a 774K SF Office to Residential Conversion in Midtown

NEW YORK, Jan. 29, 2025 /PRNewswire/ -- Northwind Group, a Manhattan-based real estate private equity firm and debt fund manager, announced today it provided a $135 million first mortgage, acquisition loan secured by the fee interest in 235 East 42^nd Street, formerly part of Pfizer's NYC headquarters in Midtown, Manhattan. The vacant 33-story office tower is planned to be converted into a Class A multifamily property with ~910 units, retail, and amenity space. This loan was originated by Northwind's latest debt fund, NDF III, formally launched in January 2025, which will continue the firm's mandate of providing well-structured financing solutions to high quality sponsors and projects in NYC and other major gateway US markets. The announcement of the new fund comes on the heels of a robust 2024, a year which saw Northwind originate over $1.1 billion in new loans. NDF III is Northwind's fifth credit fund, as the firm now manages three CRE debt funds and two healthcare debt funds.

The loan proceeds coupled with equity from David Werner Real Estate Investments (DWREI) were used to acquire the Fee position from the Seaver family. A joint venture between an affiliate of DWREI and Nathan Berman's Metro Loft, who already owns the leasehold interest, will remain as the tenant under the ground lease and lead the office to residential conversion. In August 2024, Northwind Group provided a $75 million first mortgage loan to the same joint venture for 219 East 42^nd Street. Together, both properties will be converted into ~1,600 multifamily units, making it the largest office to residential conversion in NYC history. This is Northwind's fourth loan to DWREI and comes one month after the closing of a $62.5 million loan provided to a joint venture between DWREI and 601W Companies for the acquisition of a 1M SF office building in Chicago.

Northwind has developed significant experience lending on office to residential conversion projects, with this loan being the 8th conversion project Northwind has financed. With legislation such as City of Yes supporting additional housing development, Northwind continues to finance market-leading conversion and construction projects in NYC, providing capital to high quality sponsors that will deliver much needed additional rental units to the city that is dealing with significant shortage of new supply.

David Werner, President of David Werner Real Estate Investments, said "It was a pleasure once again closing a loan with Northwind Group. They are an accurate and efficient lender, while providing flexibility where needed and the surety of execution. Northwind's proactive involvement and professional coordination were instrumental in achieving our objectives. I am deeply appreciative of the entire Northwind team, and I look forward to working with them again in the near future." 

"We are excited to close on the first loan for NDF III, executing on another transaction for our repeat borrower DWREI, and look forward to being part of their continued success. The building's structure and location make this property a great candidate for conversion, and we have no doubt that the team in-place between DWREI and Metro Loft will execute a best-in-class product which will be part of the largest office to residential conversion in NYC history. Working with David and Metro Loft on the neighboring property at 219 E 42^nd Street has been a great experience, and we are impressed by the progress they have made at both properties in such a short time. As the lender on the fee in the most senior position in the capital stack, we are committed to supporting investors looking to provide more housing to the New York City market." said Ran Eliasaf, founder and managing partner of Northwind Group.

Northwind was represented by John Vavas of Polsinelli Law Firm.

DWREI was advised by Newmark on the transaction.

About Northwind Group
Northwind Group, founded in 2008 by Ran Eliasaf, is a Manhattan-based real estate private equity firm that has executed over $5.6 billion in real estate transactions covering a portfolio of 320+ properties. Northwind invests primarily in credit instruments through its discretionary closed-ended debt funds. For further information, go to www.northwind-group.com.

About David Werner Real Estate
David Werner is a NYC based real estate investor who has been actively involved in commercial real estate for more than 40-years. He has extensive experience with both office and residential properties and has owned many iconic office buildings in NYC.

CONTACT: Jessica DeCanto, [email protected]

SOURCE Northwind Group