Northwind Group Provides $231 Million Loan for 675 Third Avenue Office-to-Residential Conversion

NEW YORK — Northwind Group, a Manhattan-based real estate private equity firm and debt fund manager, announced Nov. 2 the origination of a $231 million first mortgage construction loan for the conversion of 675 Third Avenue, a 32-story, 337,000-square-foot office building in Manhattan's Midtown East neighborhood, into residential rental apartments.

Loan proceeds retired the existing debt on the property and will fund the conversion of the building into up to 450 rental apartments, 25% of which will be affordable under the 467-m program. The conversion is being led by a joint venture between Nathan Berman's Metro Loft Management (Metro Loft) and David Werner Real Estate Investments.

675 Third Avenue Conversion: Deal and Property Details

The building at 675 Third Avenue, New York, NY 10017, occupies the full Third Avenue blockfront between East 42nd and East 43rd streets, near Grand Central Terminal. The planned conversion would create up to 450 rental apartments, with 25% designated as affordable under the 467-m program, or roughly 113 units if the full 450-unit plan is achieved.

The loan was originated by Northwind Debt Fund III (NDF III), the firm's latest debt fund. By simple calculation, the $231 million loan equals approximately $686 per existing square foot and $513,000 per planned apartment. These figures reflect loan size relative to the building, not appraised value or total development cost.

Ran Eliasaf, founder and managing partner of Northwind Group, described the project as a relatively straightforward conversion that requires no major structural work and primarily involves interior fit-out.

Joint Venture, Acquisition History and Project Team

The joint venture acquired the building in April 2025 with a $90 million acquisition loan from Northwind. The building was purchased from the Durst Organization for a reported $100 million, or about $297 per existing square foot. Since the acquisition, the sponsors have advanced the property through planning and predevelopment. The project is now ready for execution, with preliminary construction activities already taking place on site. The sponsors used equity to advance initial construction before the larger construction facility was funded.

Collaborative Construction Management will serve as construction manager, and Gensler Architecture, Design & Planning has been engaged as architect of record. Northwind was represented by John Vavas of Polsinelli Group.

Executives Comment on the Financing

"We are pleased to expand our partnership with David Werner and Nathan Berman, two of New York's most experienced and active converters of properties from office to residential use," Eliasaf said. "675 Third Avenue will deliver much-needed residential rental units to Midtown, including affordable housing, at a time when the city's housing shortage is acute."

Eliasaf said the project is the ninth conversion Northwind has financed in New York City. "These are complex projects that require a lender who can underwrite every phase, from acquisition through construction and lease-up," he said. "Having financed this property since its acquisition, we know the asset and the sponsorship very well, and we have strong conviction in their business plan."

"We are excited to continue our partnership with Metro Loft, a best-in-class operator," said David Werner, president of David Werner Real Estate Investments (DWREI). "We thank the Northwind team for always being there for us and providing certainty of execution, even on complex projects."

Berman, founder and principal of Metro Loft, said: "Thank you to the Northwind team for bringing this over the finish line. We appreciate that they are there when you need them!"

Northwind Debt Fund III and the Sponsors

NDF III recently announced its final close with $1 billion in capitalization, double its $500 million target, as part of Northwind's strategy of providing financing on residential properties in supply-constrained markets.

Founded in 2008 by Eliasaf, Northwind Group specializes in credit investments through discretionary, closed-ended debt funds. The firm has executed more than $11 billion in real estate transactions in the U.S. across more than 400 real estate and healthcare properties in 28 states.

David Werner is a New York City-based real estate investor with more than 40 years of experience in commercial real estate, including office and residential properties. Metro Loft Management was established in 1997 by Berman and is a vertically integrated real estate development and management firm known for office-to-residential conversions in New York City.

Market Context: Office-to-Residential Conversions in New York

Thirty-one office-to-residential conversions were expected in New York City in 2026, 13 more than in 2025 and more than three times the number completed in 2024. Midtown and the Financial District are the principal conversion locations, given their concentrations of older office inventory, transit access and employment density.

Midtown East is already home to several large-scale conversion projects, including the conversion of the former Pfizer headquarters by Metro Loft and David Werner into roughly 1,600 rental apartments. New York City's 2024 City of Yes zoning provisions expanded conversion eligibility to office buildings constructed as late as 1990, compared with the prior 1961 cutoff, and loosened restrictions on eligible locations and housing types.

Conversion projects must manage zoning compliance, building-code upgrades, layouts, mechanical systems, affordability requirements and construction costs, along with lease-up. Completed, the 675 Third Avenue project would add up to 450 rental units in a central Manhattan submarket, including approximately 113 income-restricted apartments.

Sources

Northwind Group press release, PR Newswire, Nov. 2, 2026: https://www.prnewswire.com/news-releases/northwind-group-provides-a-231-million-construction-loan-for-the-office-to-residential-conversion-of-675-third-avenue-a-337k-sf-office-tower-in-midtown-manhattan-302926887.html