Jeff Sutton Lands $176M Refi For 1551 Broadway

Jeff Sutton’s Wharton Properties scored a $176 million refinancing for a marquee Midtown retail property in Times Square.

Acore Capital provided a three-year, floating-rate loan for 1551 Broadway, the site of American Eagle’s 26,000-square-foot flagship store, The Real Deal has learned. The refi comes two years after Sutton secured an extension on a $180 million CMBS loan backed by the property. That loan was paid off in February, according to Morningstar.

A Newmark team of Anthony Orso, Clifford Welden and Henry Stimler brokered the deal.

The loan replaces the CMBS loan originated in 2011 by Citigroup. The loan matured in July 2021 and Sutton went into forbearance as he tried to refinance the loan and mezzanine debt, according to Trepp. Sutton defaulted on the loan four months later and it went into special servicing. It returned to the master servicer after Sutton secured the extension.

In 2022, Deutsche Bank filed a foreclosure action on behalf of the CMBS bondholders, alleging that the Sutton entity defaulted on the loan. A source said at the time that Sutton was working things out with a special servicer despite the foreclosure suit.

Wharton bought both 1551 and 1555 Broadway in a 50-50 joint venture with SL Green, for a total of $82.5 million in 2005. The building at 1551 Broadway used to be the site of the Times Square Howard Johnson’s hotel, which closed in 2005. Sutton and SL Green demolished the buildings and built new retail that opened in 2009; Sutton eventually bought out SL Green’s stake in 1551 Broadway.

The property also includes a 250-foot rentable LED sign that is leased by American Eagle. The retailer’s lease expired in February 2024 and it signed a 10-year renewal, according to an August Fitch Ratings report, but an updated rent roll was not received.

Sutton declined to comment.