Properties 1 & 2: $23,750,000 Cash-Out Perm B-Note
294,000 sq.ft. Multi-tenant Industrial
San Carlos & Belmont, CA
The first two properties of the three-property portfolio consist of 292,000 square feet of multi-tenant industrial across numerous buildings, strategically located in the Mid-Peninsula near El Camino Real and Caltrain in San Carlos/Belmont, CA.
The Sponsor sought maximum cash-out from a high-performing and under-levered asset, but the in-place debt featured an attractive fixed rate including yield maintenance. Highland creatively structured cash-out of $23,750,000 by utilizing a B-note allowing access to the appreciated equity in the property and keeping the in-place A-Note rate. This avoided a sizable prepayment penalty that would have been incurred by a complete refinance of the collateral. The B-Note is co-terminus with the existing A-Note which is fixed in 4%’s.