CMBS Buyers Face $488 Million Wipeout on NYC’s Worldwide Plaza

Money managers who bought a $705 million commercial-mortgage bond tied to Manhattan’s Worldwide Plaza building are at risk of substantial losses after the property’s appraisal was slashed amid the departure of key tenants.

The 49-story skyscraper at 825 8th Ave. was recently reassessed at $345 million, according to loan documents, less than a fifth of its original $1.74 billion value when the debt was issued in 2017. That’s left holders of the once-AAA portion of the bond on track for losses of about $53 million, or 20%, should the property be sold, based on a key industry metric known ...