- Worldwide Plaza, a 2M SF Midtown office tower, will be auctioned in January 2026 through a UCC foreclosure. The sale follows a default on $1.2B in debt.
- Mezzanine lenders Goldman Sachs and Deutsche Bank are initiating the auction. The property’s occupancy has dropped to 63% after major tenant exits.
- A recent appraisal slashed the tower’s value by 80%, from $1.7B to $345M. CMBS investors could face losses of up to $500M.
Another Midtown Trophy Hits Distress
Worldwide Plaza is a 49-story office building at 825 Eighth Avenue. It will be sold at a Uniform Commercial Code (UCC) foreclosure auction on January 15, 2026, reports Bisnow. The auction follows a debt default by its ownership group, which includes SL Green, RXR, and New York REIT Liquidating.
The Numbers Behind The Trouble
Goldman Sachs and Deutsche Bank issued $260M in mezzanine financing for the building. It also carries $940M in senior CMBS loans. These loans were part of a $1.7B acquisition in 2017. Now, the mezzanine lenders plan to seize control of the building by auctioning the ownership entity.
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Occupancy Woes And Valuation Plunge
Worldwide Plaza has struggled since law firm Cravath, Swaine & Moore left its 617K SF lease in 2023. The move dropped occupancy to 63% by March 2025. It had been 91% in 2023. In August, an appraisal slashed the building’s value from $1.7B to just $345M. That triggered major losses for CMBS investors.
DBRS Morningstar later downgraded the CMBS trust that holds $705M of the debt to junk status. The special servicer is now negotiating a loan modification.
Investor Impact
With the tower’s value down by over $1.4B, CMBS bondholders—once holding AAA-rated securities—could face up to $500M in losses. A special servicer is reportedly negotiating with borrowers on a potential loan modification.
What’s Next
Nomura, the tower’s largest tenant, has agreed to give up 75K SF of office space by 2027. The company still leases 630K SF through 2033. With occupancy low and refinancing options limited, the January auction could become one of Manhattan’s most high-profile office foreclosures since the pandemic.
