SAMPLE CLOSED TRANSACTIONS
The principals of Highland Realty Capital have a strong track record successfully arranging competitive bridge, construction, equity and permanent financing for income producing projects on the West Coast. We have a track record in excess of $5.5 billion in closed transactions. We have summarized a representative list of projects below:
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CSAA Portfolio (Office)
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| Property: |
A four-building, 597,000 square foot office portfolio located one block from City Hall in San Francisco. The Property is the current headquarters of the California State Automobile Association (AAA). |
| Location: |
San Francisco, CA |
| Financing: |
HRC arranged $50 million of joint-venture equity and $132 million of bridge debt financing for the acquisition and $45 million renovation and repositioning of the four-building office portfolio. Despite the volatile capital market environment, HRC was able to leverage their existing debt and equity relationships to close an exceptionally complicated deal in a timely manner. The debt is a 70% non-recourse bridge loan that will fund improvements and leasing on a pro rata basis with the equity. Additionally, the loan was structured without syndication as a requirement of close. |
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Tops Plaza (Retail)
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| Property: |
A 156,000 sq ft grocery-anchored shopping center located along a major thoroughfare. At acquisition, the property was approximately 33% occupied, but the Borrower also had an executed anchor tenant lease for an additional 56,000 sq ft. The Borrower planned to re-brand the shopping center with a predominantly Asian theme and improve both the tenant mix and tenant quality. |
| Location: |
Edison, NJ |
| Financing: |
HRC arranged $35 million in senior bridge financing and $11.2 million in joint venture equity to finance the property?s acquisition, rehabilitation, and lease-up. The senior financing featured a fixed rate initial funding and reserves for hard & soft costs, tenant improvements, leasing commissions, and interest carry. The $11.2 million equity investment came from a fund and represents 90% of the project?s required equity. |
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Northern CA Multifamily Portfolio
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| Property: |
600 unit, four-property multifamily portfolio located in Northern CA. |
| Location: |
Antelope, Rocklin, Sunnyvale, and Orangevale, CA |
| Financing: |
HRC arranged $39 million in fixed-rate agency debt to refinance an existing credit facility encumbering all four assets. Structured as four new loans, the new financing allowed an existing low-cost credit line to remain in-place for the Borrower?s future use. The new financing carries an 11-year term with 30-year amortization. |
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Premier at City Place (Apartments)
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| Property: |
221-unit luxury apartment project constructed above over 76,000 square feet of street level retail. |
| Location: |
Downtown Long Beach, CA |
| Financing: |
$25.5 million construction loan coupled with $2.35 million in mezzanine debt comprising 95% of total project costs. The mezzanine debt was competitively priced at LIBOR + 7% with no profit participation. This high leverage financing structure allowed the developer to maintain 100% ownership of the project. Midway through construction, the developer wished to reduce his recourse exposure by bringing in a joint venture partner. The principals of HRC arranged $5.5 million in joint venture financing reducing the recourse financing from 95% of cost to 77%, and returning some cash equity to the borrower. |
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Hotel Vitale
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| Property: |
A 200 key, four star hotel developed and operated by Joie de Vivre Hospitality |
| Location: |
San Francisco, CA |
| Financing: |
Preferred equity for the development of San Francisco?s newest luxury boutique hotel, opened March 2005 at a development cost of $52.0MM. The financing was procured at the depth of the San Francisco hotel recession. Hotel Vitale is widely concerned to be San Francisco?s most popular and successful hotel development in a generation |
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The Promenade at Howard Hughes Center (Retail)
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| Property: |
A 250,000-sf entertainment and retail complex anchored by Nordstrom Rack, Borders Books and an 18 screen stadium seating theatre which includes a 3-D Imax. The shopping center is part of the Howard Hughes Center which includes over 1.4 million sq. ft. |
| Location: |
Westchester, CA |
| Financing: |
$61 million, non-recourse construction loan (100% LTC). The Borrower received market rate developer fees and 50% of the transaction profits after payment of a preferred return to the capital source. |
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The Peloton (Condominiums)
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| Property: |
A 390-unit, luxury condominium development with 17,000 sq. f. of commercial space. Located on 10 acres, the project will offer lofts, 1, 2 and 3 bedroom units in four contemporary residential buildings constructed over subterranean parking. |
| Location: |
Boulder, CO |
| Financing: |
$150 million in non-recourse construction financing and joint venture equity, arranged through a single institutional capital source. |
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Northern California Apartment Portfolio
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| Property: |
922 class-B apartment units in 8 separate complexes |
| Location: |
3 properties were located in the San Francisco Bay Area, and 5 were located in the Sacramento Region |
| Financing: |
A $50 MM Freddie Mac credit facility, with the bottom $40 MM fixed at an attractive rate and the top $10 million available as a credit line under a sub 165 spread variable rate structure. The unique structure accomplished three things for the Borrower ? 1) it anchored a third of its portfolio at a market-low fixed rate, 2) it created a flexible credit line facility that provided a competitive advantage in acquiring properties, and 3) it provided a simple mechanism to handle future estate tax issues |
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Ambrose Hotel
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| Property: |
A new 77-room craftsman-style hotel with an Asian flair uses the ancient Chinese discipline of Feng Shui to tap nature for a boost of metaphysical energy |
| Location: |
Santa Monica, California |
| Financing: |
$7.0 million construction loan (75% LTC). The client owns 33 hotels nationwide with a focus in limited service brands. |
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Luxury Apartment Portfolio
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| Property: |
Portfolio of three luxury apartment projects comprised of 250 units |
| Location: |
Beverly Hills, West Hills and Sherman Oaks, CA |
| Financing: |
$46.1 million forward commitment for permanent financing arranged through a national pension fund. The buildings were in lease up, having been recently constructed or renovated, and the borrower wished to lock in a fixed rate. The loan was structured with an initial funding and an earnout to be released upon stabilization. |
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Courvoisier Court (Condominium Conversion)
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| Property: |
272-unit condominium conversion. The units range in size from 780-sf to 2,500-sf, and sales prices range from $315,000 to $1,175,000. |
| Location: |
Miami, FL |
| Financing: |
$99 million, non-recourse bridge loan comprising 90% of total project costs. |
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Merchant Exchange Building (Office)
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| Property: |
A 240,000 SF historic office building built in 1904; includes ground floor retail and the luxurious Julia Morgan Ballroom event facility |
| Location: |
San Francisco, CA |
| Financing: |
A $37.5 MM, 20-year, fixed-rate permanent loan, including 8 years of interest only, then amortized over 30 years. The 60% LTV loan allowed the payoff of a higher-rate loan, the consolidation of various debt, funds for tenant improvements and leasing commissions for vacant space, and some cash out. It also provided for additional funds to be borrowed on first mortgage terms in increments of $5 million, subject to LTV and DSC constraints. |
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Park Ridge and North Glen (Apartments)
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| Property: |
Two apartment complexes totaling 792 units - both properties feature amenities such as pools, fitness centers, playgrounds, laundry rooms, and balconies or patios for most units. The two properties were a combined 20% vacant at closing, and in-place tenants were paying well below market rents. The previous owner had attempted to convert the properties to low income housing; as a result each property?s title included rent restrictions limiting the level of income a tenant could earn as well as the amount of rent the landlord could charge. |
| Location: |
Atlanta, GA |
| Financing: |
HRC has arranged $35 million in non-recourse acquisition bridge financing (66% of total cost) and $16.1 million in joint venture equity (90% of the project?s required equity). The interest rate on the initial funding was fixed at a spread over the 3-year treasury swap, allowing the Borrower to take advantage of the prevailing difference between swaps and LIBOR. Reserve accounts were established for capital improvement costs and loan interest; these reserves will be drawn at a floating rate based on LIBOR. The equity was structured as a ?subscription facility,? which will allow the Sponsor to access additional equity from the same investor for future projects. The Borrower?s business plan was to remove the rent restrictions, complete a series of physical improvements, and increase the properties? NOI over a 36-month period. |
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Trump Tower at Beachwalk (Condominiums)
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| Property: |
A 476-unit luxury condominium-hotel development |
| Location: |
Waikiki Beach, Honolulu, HI |
| Financing: |
$38.35 million, non-recourse acquisition and development loan comprising 80% of total A&D costs. The loan will ultimately roll into a $350 million construction loan once a GMAX contract is executed and the appropriate amount of pre-sales are achieved. |
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The Redstones (Townhomes)
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| Property: |
At closing, the property was a 9-acre site improved with 156,000 sq ft of class-B office (only 29% occupied). The Borrower plans to process entitlements for residential thownhomes. |
| Location: |
Boulder, CO |
| Financing: |
HRC arranged $11.4 million (75% loan-to-cost) in non-recourse interim financing to process residential entitlements. In the event that the Borrower does not obtain entitlements, the loan allows the flexibility to re-allocate reserved funds to reposition the existing office park. The loan is floating rate over LIBOR and features a declining prepayment structure. |
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Ralph's Shopping Center
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| Property: |
Class ?A? 46,000 square foot neighborhood shopping center built in December 1997. High quality tenants include Ralph?s, Starbucks, Quiznos and Robeks Juice |
| Location: |
El Segundo, CA |
| Financing: |
$12.75 million permanent loan, 15 year term, five years of interest only payments, then 30 year amortization, arranged through a life insurance company. |
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Belamar and Casa Linda (Apartments)
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| Property: |
A 67-unit, gated-entry, multifamily complex with a pool, numerous waterscapes, laundry facilities, and semi-subterranean parking. The other property is a 74-unit multifamily complex featuring amenities such as a pool, game room, and balconies. |
| Location: |
Near Downtown Los Angeles and Sherman Oaks, CA |
| Financing: |
HRC has arranged a $15.4 million non-recourse acquisition/bridge loan, fixed for five years, and requiring interest-only payments. The initial funding was maximized by establishing a small interest reserve ? at closing, funded loan proceeds resulted in a sub-1.00 DCR. The two properties were cross-collateralized and will remain so until they achieve a 1.00 DCR on interest-only payments. The Borrower, a major national equity fund focused on value-added multifamily opportunities, plans to renovate the common areas and unit interiors and minimize the properties' current loss-to-lease. |
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Two Southern CA Retail Centers
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| Property: |
A 34,000 net rentable sq. ft. single-tenant retail building fronting along one of West Los Angeles? main thoroughfares. The other property, part of a power center in Oceanside, consists of two tenants in a total of 44,000 net rentable sq. ft. |
| Location: |
West Los Angeles and Oceanside, CA |
| Financing: |
HRC has arranged a combined $18.4 million in non-recourse, long-term, fixed-rate financing to refinance both properties out of their respective bridge loans. Both transactions required the lender to fund before the tenants had significant operating histories. In the Oceanside property, one of the two tenants had yet to take occupancy; remaining leasing costs and rent abatement were accounted for using a holdback structure. Both transactions were full-term interest-only. |
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Hitachi Plaza (Office)
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| Property: |
220,000 sq.ft Class A office tower |
| Location: |
Brisbane, CA |
| Financing: |
$38.5MM permanent loan including $7.0MM earn out feature to refinance a highly visible office tower near the San Francisco International Airport and the U.S. headquarters of Hitachi Corporation. The refinance returned a substantial portion of the sponsor?s invested and earned equity |
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Gardena Valley Shopping Center
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| Property: |
A 130,000-sf neighborhood shopping center anchored by Von?s and Rite Aid. |
| Location: |
Gardena, CA |
| Financing: |
$18 million construction loan representing 90% of total project costs, plus a $20 million 24-month forward commitment for permanent financing. The financing was arranged through a pension fund that provided flexibility on structuring issues (e.g. no yield maintenance in the event the borrower did not take down the entire $20 million permanent loan). |
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Terraces at the Grove, Toscana, and Summit (Apartments)
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| Property: |
Three multifamily properties with 192 total units. The properties were in various stages of renovation and re-leasing as the developer sought to reduce the properties? loss-to-lease. |
| Location: |
Southern CA |
| Financing: |
HRC has arranged $28.5 million in non-recourse fixed-rate bridge financing to recapitalize three multifamily properties in Southern CA. All three properties were previously financed with floating rate bridge loans. HRC refinanced all three loans with a balance-sheet lender. The loans feature a flexible prepayment feature that allows for reduced exit costs if prepaid after 24 months. Funds reserved for renovations and capital improvements will be floating rate, based on LIBOR. |
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Dogtown Station Condominiums
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| Property: |
A 35-unit condominium loft development |
| Location: |
Venice, CA |
| Financing: |
$22.5 million, non-recourse construction loan (80% LTC). The units average 1,785 sf ranging in size from 1,180 sf to 2,330 sf, and sales prices ranging from $750,000 to $1,350,000. |
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The Ocean?s Edge Hotel
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| Property: |
A to-be-built 208-room full-service hotel, consisting of two 4-story buildings and a 340-space parking structure, plus including a restaurant/bar and 10,000 square feet of meeting space |
| Location: |
Monterey, CA |
| Financing: |
A $59 MM construction loan, secured by a 99-year leasehold interest in the land, and representing nearly 75% LTC. The loan was structured with a 5-year term to allow plentiful time for stabilization. The property was originally slated to carry a 4.5-star flag, but because of favorable capital markets feedback, the Borrower decided to unflag the property, creating substantial additional cash flow and value |
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Premiere At Thousand Oaks (Apartments)
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| Property: |
148-unit luxury apartment project |
| Location: |
Thousand Oaks, CA |
| Financing: |
$17 million construction loan coupled with $1.3 million in mezzanine debt, comprising 90% of total project costs. The mezzanine was competitively priced at approximately LIBOR + 7% with no profit participation. This high leverage financing enabled the developer to maintain 100% ownership of the project. |
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333 Fremont (Apartment/Condominium)
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| Property: |
An 83-unit apartment/condominium development |
| Location: |
San Francisco, CA |
| Financing: |
$34.81 million (95% LTC) financing comprised of a $26.2 million non-recourse construction loan and an $8.61million equity investment. The construction loan equated to 72% LTC and the equity represented 82% of the required equity. The units average 850 sft and the average sales price will be $475,000 including the ?below market rate? units. |
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Homewood Suites La Quinta Hotel at Centre Point
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| Property: |
130-room Homewood Suites by Hilton, an extended stay hotel. Planned as part of a larger, mixed-use development to include restaurants, medical center, boutique hotel and spa, and condominiums to be rented as vacation units |
| Location: |
La Quinta, CA |
| Financing: |
$13.6 million construction loan, representing 70% of total project costs. |
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Imperial Norwalk Center (Office)
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| Property: |
A 450,000-sf office building occupied primarily by government tenants |
| Location: |
Norwalk, CA |
| Financing: |
$50.35 million non-recourse bridge loan comprised of a $38.63 million, floating rate senior piece, and an $11.72 million ?B? piece. The yield on the B piece was capped. The financing structure provided 100% of TI and leasing commission dollars, allowing the borrower to complete the lease up of the building. Upon stabilization, the principals of HRC arranged a $47 million permanent loan, with a 15 year term. The first five years were interest only to maximize the borrower?s cash on cash returns. |
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Waikoloa Village (Land)
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| Property: |
45.1 acres of commercial zoned land. Proposed uses include 200,000 sq ft of retail, a 150-key hotel, 346 residential units, and 40,000 sq ft of self-storage. All proposed uses are allowed under the property?s current zoning. |
| Location: |
Kohala Gold Coast area of the Big Island of Hawaii |
| Financing: |
HRC arranged $18 million (80% loan-to-cost) in fixed-rate acquisition and predevelopment financing. The debt is non-recourse, carries a term of 24 months, and has no prepayment penalty or fee. |
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Serramonte Center (Retail)
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| Property: |
An 865,000 square foot regional mall, built in 1968, and anchored by Macy?s, Target, and Mervyn?s. |
| Location: |
Daly City, CA |
| Financing: |
A $95 MM, 7-year, fixed-rate forward commitment that funded when the existing higher-rate loan?s prepayment penalty burned off. The rate was fixed below 5%, and allowed a substantial amount of the Borrower?s equity to be returned. The loan also allowed additional first mortgage funds to be borrowed after the Borrower?s ongoing $10 MM rehabilitation and repositioning of the property. Finally, the terms were negotiated to allow up to 50% of the Borrower?s interest to be sold to a REIT during the loan closing or within a specified time period following closing. |
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Terraces at Madrona (Apartments)
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| Property: |
An 84-unit apartment project located just three blocks north of the Sherman Oaks Galleria |
| Location: |
Sherman Oaks, CA |
| Financing: |
A 95% LTC participating loan in the amount of $12,991,000. The property was acquired for $11.8 million and borrower plans an $850,000 interior and exterior rehab. At closing, the units were 20% below market. The sponsor plans to increase rents by an additional 12% to 14% post-rehab. |
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The Estates at Point Happy (SFR Lots)
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| Property: |
69-lot residential subdivision |
| Location: |
La Quinta, CA |
| Financing: |
$8.6 million for acquisition and horizontal development, and $27.4 million for the construction of luxury homes ranging in size from 2,800 to 3,550-sf. Sales prices range from $600,000 to $1,200,000. |
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The Atrium at Empire Lakes (Office)
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| Property: |
A 431,000-sf former General Dynamics building being renovated into ?Class A? office space. |
| Location: |
Rancho Cucamonga, CA |
| Financing: |
$37.3 million, non-recourse bridge loan (83% LTC). The loan included approximately $10 million of construction proceeds to complete the Phase 2 renovation. |
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Alder Creek (Apartments)
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| Property: |
148-unit, gated-entry, multifamily complex with a pool, two laundry facilities, and outdoor recreation area. The property mix consists of one and two bedroom units. |
| Location: |
Riverside, CA |
| Financing: |
HRC has arranged a $14.5 million in non-recourse acquisition/bridge financing, representing 80% of total cost. The interest rate on the initial funding was fixed at a spread over the 5-year treasury. Reserve accounts were established for renovation and capital improvement costs; as reserve funds are drawn they will accrue interest at a competitive spread over LIBOR. The loan features an attractive prepayment option that allows the sponsor to sell or refinance after 24 months with minimal exit costs. |
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Westlake Office/Retail Portfolio
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| Property: |
A 4-property portfolio, consisting of Gresham Station Shopping Center, a 300,000 square foot big box retail center anchored by Best Buy, Borders, Old Navy, Bed Bath & Beyond, and Cost Plus World Markets; Gresham Station North, a 145,000 square feet newly- |
| Location: |
Gresham Station Shopping Center and Gresham Station North located in Gresham, OR; City Center West located in Las Vegas, NV; and 8801 Horizon Way located in Albuquerque, NM |
| Financing: |
One lender provided separate loans for each property which totaled $97.4 MM. The 60% LTV loans were fixed at a sub 95 spread over the 10-year Treasury, and accommodated a 100% rollover in the Albuquerque building coming due in 3 years. |
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The Clearwater Condo-Hotel
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| Property: |
An existing 151-room hotel, situated on 6 acres will be entitled for a 300+ unit condominium hotel with 30,000 sq. ft. of ground floor retail. |
| Location: |
Mammoth Lakes, CA |
| Financing: |
$16.5 million non-recourse bridge loan |
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The Moore Building (Apartments)
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| Property: |
79-unit luxury apartment project over 7,800 square feet of ground floor commercial space. The Moore Building will have the highest level of finishes in Sonoma County. |
| Location: |
Santa Rosa, CA |
| Financing: |
$15.3 million construction loan arranged through a local bank |
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5353 W. Bell Road (Office)
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| Property: |
A vacated 203,175-sf office building formerly owned/occupied by Honeywell to be subdivided and retenanted. |
| Location: |
Glendale, AZ |
| Financing: |
$13.1 million, non-recourse bridge loan equaling 80% LTC and a $4.74 million equity investment representing 90% of the required equity. |
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Cosmo Lofts
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| Property: |
A 50-unit live-work loft conversion |
| Location: |
Hollywood, CA |
| Financing: |
$11 million, 10-year fixed rate loan. The loan was structured with multiple fundings, with an initial funding at 65% occupancy, and two additional fundings at 81% and 94% occupancy. This allowed the borrower to close on a permanent loan prior to stabilization and eliminate interest rate risk by locking the 10-year Treasury yield in the low 4% range. |
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Watermark Waikiki (Condominiums)
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| Property: |
A 212-unit condominium development |
| Location: |
Waikiki Beach, Honolulu, HI |
| Financing: |
$10.0 million, non-recourse acquisition & development (A&D) loan. Lender also funded 50% of the predevelopment and entitlements. |
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Point Happy (Mixed-Use)
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| Property: |
70,000-sf mixed-use project comprised of retail and office uses |
| Location: |
La Quinta, CA |
| Financing: |
$29 million in total financing for (1) development of horizontal infrastructure, (2) construction of office and retail buildings, and (3) permanent financing upon stabilization of the final phase of development. |
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The Summit at Tri-City (Office)
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| Property: |
A 12-building, 98,000-sf, ?For Sale? office park |
| Location: |
San Bernardino, CA |
| Financing: |
$10.0 million, non-recourse construction loan (80% LTC). No presales required to release funds. |
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City Place Apartments (Sale)
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| Property: |
221-unit luxury apartment project constructed above over 76,000 square feet of street level retail. |
| Location: |
Downtown Long Beach, CA |
| Financing: |
The principals of HRC arranged the sale of this newly constructed ?Class A? apartment project, during lease up, to an apartment REIT. The $44 million purchase price represented an approximate 5.8% cap rate on Year 1 proforma NOI. |
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Chateau Marina and Fiji Villas Apartments (Sale)
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| Property: |
Two luxury apartment projects totaling approximately 500 units |
| Location: |
Marina del Rey, CA |
| Financing: |
Sale of the project to an apartment REIT |
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The Montgomery (Condominium Conversion)
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| Property: |
Conversion of a historic downtown San Francisco office building to 106 luxury condominium units |
| Location: |
San Francisco, CA |
| Financing: |
$59.5MM total capitalization including $49.5MM of construction financing and $10.0MM of mezzanine debt to recapitalize a class B office building and convert the property to luxury residential units |
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Copley Corporate Center (Office)
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| Property: |
The property consists of one three-story building, containing approximately 120,483 rentable SF and a four-story 160,000 SF parking structure situated on 5.32 acres. The building, which was built in 2001, has a rectangular shaped footprint and sits promi |
| Location: |
San Diego, CA |
| Financing: |
$21.2 million non-recourse permanent loan (75% LTV), 10 year term and 30-year amortization. Since the borrower was structured as a TIC, the lender only assigned recourse liability for the carve-outs to the corporate entity instead of the investors personally. |
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Buena Vista Business Park (Industrial)
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| Property: |
An 8-building ?For Sale? industrial park totalling 294,350 RSF; buildings range from 17,000 to 62,000 rentable square feet. |
| Location: |
Irwindale, CA |
| Financing: |
$1.9 million equity investment which increased the financing to 96% loan-to-project costs. This was a ?for sale? program and the client (developer) was confident he would pre-sell buildings during construction. Client was willing to subordinate to a high preferred return to the investor, in return for capping the return. Upon sell-out, the developer obtained over 70% of the profits from this transaction. |
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North San Jose Technology Park (Office)
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| Property: |
142,700 sq.ft office and R&D complex |
| Location: |
San Jose, CA |
| Financing: |
$21.2MM redevelopment capital including a $16.7MM non-recourse bridge loan and $4.5MM of joint venture equity. Despite a high overall R&D vacancy level in the market at the time, the deal positioned the sponsor to take advantage of a rising market substantial cash flow being generated by the high quality, highly visible assets |
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Wilson Sonsini Building (Office)
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| Property: |
71,400 sq.ft Class A office building |
| Location: |
Palo Alto, CA |
| Financing: |
$18.0MM permanent loan secured by a leasehold interest in the headquarters office building of the headquarters of Wilson Sonsini Goodrich and Rosati, Silicon Valley?s dominant law firm. This high-leverage permanent financing enabled the sponsor to acquire the subject with minimal cash equity investment and took advantage of an above market rental stream |
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