$12.3M Creative Office Perm Loan;

Property:

44,000 sf creative office building

Location:

900 N. Cahuenga Blvd. in Hollywood, CA, in the Hollywood Media District

Financing:

HRC arranged both the $12,300,000 bridge loan to finance the conversion of flex industrial property (that had been rented to Time Warner Cable for 10 years) to high-demand creative office space, and the $12,300,000 takeout perm loan one year later.

HRC marketed the bridge loan to debt funds and banks; debt funds being willing to take more risk, but charging higher interest rates. A pre lease signed with Vince, an NYSE publicly traded designer clothing company, for 65% of rentable square feet allowed HRC to secure 3-year financing from a mid-tier bank for a 60% LTV loan at a sub 3% interest rate. The borrower spent $100/sf on repositioning and TI expenses.

HRC arranged the 10-year perm loan with a life insurance company with the following terms: 2 years interest only followed by a 30-year amortization schedule, 60% LTV, sub 4% interest rate. The property was 100% occupied at perm loan closing.