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TRANSACTION OF THE WEEK !
$11,160,000 ($98 Loan/Sq. Ft., 75% of Total Project Cost) Acquisition/Reposition Senior Bridge Financing for 6-Building, 113,363 Sq. Ft. Office/R&D Business Park: GSP arranged $11,160,000 of non-recourse senior bridge financing (75% of total project cost) for the acquisition and reposition of a 6-building, 116,363 sq. ft. office/R&D business park in Orange County, CA. The Property: The property is ½ of a contiguous business park (the other ½ was purchased by the client and financed by GSP late last year), 100% occupied with 6 tenants (each building has separate tenant), Class B office/R&D use located on approx. 9.4 acres, built late 1960's to late 1970's, % office build-out between 68% and 100% with property average build-out of 80%, average in-place rents 57% below market, 60% of tenants rolling in next 2 years. Location: Institutional quality, "high identity", in-fill location adjacent to upscale bedroom communities and major transportation corridors. Area features numerous amenities including restaurants, hotels, and prime retail. Submarket Occupancy: 95%+. Reposition: Borrower will cosmetically upgrade the project, convert the majority of the existing warehouse space into office space, and raise rents to market upon tenant roll-over. Capital Structure: (1) Purchase Price: $12,704,000; and (2) Renovation, Leasing Reserve, Working Capital Reserve, Interest Reserve, Closing Costs: Approx. $2,293,000. Total Capitalization: Approx. $14,997,000. The Financing - Senior Debt: (1) Loan Amount: $11,160,000 (approx. 75% of total cost); (2) Rate: LIBOR + 2.70%; (3) Term: 3 years with a one-year extension for ¼ point; (4) Interest only with 25 year amortization during extension period; (5) Non-recourse; (6) Lender Fee: 1.00%; (7) Prepayment: Year 1 - locked, mos. 13-18 - 0.50% fee; thereafter par. (Gary E. Mozer, Lee T. Norman)
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