Kushner Companies, the firm owned by the family of White House Senior Adviser Jared Kushner, has secured a $400 million loan for 666 Fifth Avenue in Midtown Manhattan.
According to a report from Bloomberg, Kushner and Chinese insurance firm Anbang have agreed to a deal worth $4 billion.
The transaction contained terms that were unusually favorable to the Kushners, experts said.
The 41-story tower was valued at $2.85 billion, the highest ever for a single building in Manhattan. The building’s office section generated a valuation of $1.6 billion while the retail portion was valued at $1.25 billion. The existing mortgage on the property will also be reduced to about one-fifth of the current amount.
The refinancing plan for the property is said to contain an unusual provision called a “hope note.” This pertains to a $115 million loan that the Kushners took out in 2011. The loan, which was funded by Barclays, has grown to over $250 million due to compounded interests. The agreement allows the Kushners to settle the mortgage at just $50 million.
As part of the deal, Anbang will gain an equity stake in the tower. The joint venture will refinance the building’s $1.15 mortgage. The two sides are also said to be raising additional funds through the EB-5 visa program.
Anbang’s ties to the billion Chinese government have raised concerns among US officials. In 2015, former President Barack Obama refused to stay in the Waldorf Astoria, which the company also owns, over fears of espionage.
An investigative report from the New York Times traced the links between Anbang and China’s power structure.
Anbang chairman Wu Xiaohui, who worked as car salesman and anti-smuggling official, is married to Zhou Ran, the granddaughter of Deng Xiaoping, who was the Chinese communist leader from the late 1970s to 1997.
Other early investors in the company include Levin Shu, the son of the country’s former prime minister, and Chen Xiaoli, the son of an army marshal.
As part of the deal, Anbang will take out a $4 billion loan to renovate the building’s upper floors into luxury apartments.
The Kushners, meanwhile, will get a $100 million loan from other investors on top of the $400 million loan from Anbang.