Extell Lands $1.25B Financing for Times Square Hotel Tower

Extell Development has closed on $1.25 billion in financing to complete The Torch, its 60-story hotel and retail tower under construction in Times Square, according to The Real Deal. The financing package includes a $1.1 billion construction loan from a bank group led by JPMorgan and $150 million in mezzanine debt, per a filing with the Tel Aviv Stock Exchange. Extell has finished 40 of the tower’s 60 stories to date.

Betting Big on Times Square

The Torch is shaping up to be one of the more ambitious hotel developments in recent New York City history. The tower’s 1,800-room hotel would rank among the largest by room count in the city, and an unnamed international hotel chain has already signed a 40-year franchise agreement, committing $60 million to the project. That scale reflects Extell’s broader wager that Times Square’s tourism-driven foot traffic can support a mixed-use tower built around hospitality and entertainment rather than office or residential space, a strategy that leans into the neighborhood’s identity as one of the most visited destinations in the world rather than competing directly with Midtown’s office corridor.

The Details

Beyond the hotel rooms, the project includes 130,000 square feet of advertising space, a drop tower ride, three observation decks and 94,000 square feet of food and beverage space. Extell has signed a 15-year deal with a restaurant group to operate the tower’s restaurants, bars and observation deck. Altogether, the developer projects the completed property will generate net operating income of between $250 million and $270 million annually, a figure that reflects just how many distinct revenue lines Extell has stacked into a single tower, from room nights and food and beverage sales to advertising and ticketed attractions.

Zooming Out

The financing lands amid a broader wave of hotel investment activity across the city, which CRE Daily has tracked as part of a NYC hospitality boom tied to steady tourism and convention demand. Extell’s willingness to build one of the city’s largest hotels from the ground up, rather than acquire and reposition an existing property, sets it apart from recent hotel deals that have leaned toward conversions and refinancings, such as Cain Real Estate’s October 2025 purchase of SoHo’s Dominick Hotel, formerly the Trump SoHo, for $175 million, according to the Commercial Observer.

Why It Matters

The deal also stands out against a broader lending backdrop that’s grown more cautious toward hospitality assets. A recent hotel labor deal has pushed some lenders toward more conservative underwriting on NYC hotel projects, making Extell’s ability to secure a $1.1 billion construction loan led by JPMorgan a notable vote of confidence in the asset class. It also signals continued institutional appetite for trophy hospitality assets in top-tier tourist corridors, even as smaller hotel owners face tighter financing conditions elsewhere in the city. The projected $250 million to $270 million in annual net operating income underscores why lenders were willing to back a ground-up build of this scale: the mix of hotel rooms, advertising space and entertainment attractions gives Extell multiple revenue streams rather than relying on room rates alone.

What’s Next

Extell still has 20 stories to go before The Torch tops out, with the hotel’s 1,800 rooms, observation decks and entertainment attractions positioning it to compete directly with existing Times Square tourist draws once it opens. Expect additional retail, restaurant and naming-rights announcements as the developer works to line up tenants ahead of a completion date that has not yet been publicly disclosed. The 40-year hotel franchise agreement already in hand gives Extell a long runway to fill the remaining commercial space, and the size of the projected NOI suggests the developer has room to be selective about which additional operators it brings on board for the observation decks and advertising space.