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HOUSTON-With a year to go on a conduit loan, Dallas-based Shafer Property Co. has secured $10.9 million of fresh capital collateralized by a 43,000-sf, shadow-anchored shopping center with a 96% occupancy.
The borrower refinanced Shafer Plaza at 8383 Westheimer Rd. through JPMorgan Chase. The 10-year, non-recourse loan will replace conduit financing with Merrill Lynch that was set to mature in May 2006, according to Brad Donnell, a senior director with Dallas-based Metropolitan Capital Advisors Ltd. The JPMorgan financing, with a 5.5% fixed-rate interest, represents 85% of the asset's value, he says.
"We were really focused on fixing a rate now versus a year from now," Donnell tells GlobeSt.com. "It made sense to pay the minimal pre-payment penalty and take the risk out by locking in a rate for the next 10 years."
With a Wal-Mart Supercenter as its neighbor, the six-year-old center sits on a 3.8-acre hard corner of Westheimer and Dunvale roads. Its roster is a mix of national and local tenants. The anchor tenant is a 24,500-sf DSW Shoe Warehouse, which is tied to a lease through 2010. Other tenants are Movie Trading Co., Fadi's Mediterranean, Cingular Wireless and Summit Cleaners. Rents average $22 per sf, triple net.
"The Wal-Mart really helped on pricing," Donnell says, adding Shafer Plaza's location and tenant mix were particularly attractive to a lot of lenders. "All lenders are clamoring for a stuff that right in the middle of the fairway rather than in the rough," he says. The financing closed within 45 days.
According to Donnell, the longstanding relationship between JPMorgan Chase and Shafer Property Co. had an impact on the transaction. "Shafer has done deals with JP Morgan in the past," he says. "They just really like each other." JPMorgan, he adds, mostly likely dump the loan into a CMBS pool.
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