Executive Vice President Scott Monasch recently arranged a $19,000,000 refinance loan on the former Wrigley Chewing Gum Factory in Santa Cruz, CA. The loan structure was a fully amortizing 15/15 mortgage, non-recourse, at a high 3% interest rate. The borrower was also able to tap into the equity and pull substantial cash out to pay off TI costs and retire some additional debt facilities. There are no reserves required. The borrower paid a substantial prepayment penalty on their existing loan, to take advantage of this low interest rate opportunity/market place.
The property is a 386,000 sqft building which was purchased over 12 years ago with a high level of vacancy, and was primarily manufacturing and warehouse space. The building is also unique as it has second story space. The owners have since strategically and successfully redeveloped the property and transformed it into a modernized multi-use facility, boasting a broad mix of government, national, regional and local tenants. There is a high level of class A office in the government spaces and a mix of R&D, office and warehouse throughout. The property exhibits a high level of quality and is a highly sought after tenant destination, which offers unique space quality and size options to the market.
The loan was presented to Barry Slatt’s life insurance correspondent network and a large cross section of other lenders. The large size of the property within this market, and the mixed use nature provided some challenges/education to out of market lenders. There were multiple loan options presented. Ultimately, the loan was placed with a regional bank, who’s local knowledge, ability to quickly inspect the property and meet the borrowers, allowed them to move quickly and aggressively to win the business. Feel free to contact Scott with any further questions regarding this loan or to discuss any loan requirements you presently have.