Opus Bank’s Structured Finance division provides a $3,400,000 bridge loan to refinance and provide tenant improvement and leasing commission financing for a multi-tenant industrial property located in Upland, CA
Overview of Transaction
The client is a professional local real estate investor that specializes in stabilizing industrial/warehouse properties.
The client was seeking maximum flexibility in a bridge loan to negotiate lease extensions and renewals as well as pay off an existing high-interest rate loan from a private lender and cash out approximately $165,000.
The client plans to convert the month-to-month tenants to longer term leases and will likely achieve higher rents, as current rents are below market.
Significance of Transaction
The borrower was looking for an interest only option with maximum flexibility to either extend existing tenant leases, attract a credit tenant to replace existing tenants, or sell the property without incurring prepayment penalties.
Opus Bank's Role
Opus Bank’s (“Opus”) Bridge Program was a good fit for the client's needs as the program allowed us to set aside tenant improvement and leasing commissions reserves, so the client could maximize their exit strategy.
In addition, our program is interest only for the full term with no prepayment penalty. The total loan amount of $3,400,000 was 49.5% of the stabilized valuation.
At closing, Opus provided a $3,250,000 initial funding which was 47.3% LTV, while the remaining $150,000 is held back at closing and can be released to fund tenant improvements and leasing commissions.