The 10-year fixed-rate loan was priced at approximately 100 basis points over the 10-year treasury with a 30-year amortizations schedule. The first three years are interest only. Los Angeles-based Sonnenblick-Eichner Co. sourced the funds from a Wall Street investment bank. The borrower is Cupertino, CA-based J. Volkman & Assoc.

The 80% loan paid off a previous mortgage that Sonnenblick-Eichner had arranged for the borrower on the property in 1997. "Our client was able to take advantage of the very favorable debt markets for retail and consequently locked in long term financing at approximately 5.5%," says David Sonnenblick. "The amount of pent-up equity that he realized from this transaction combined with the cost savings on the interest rate of the new loan more than offset the expense of prepaying his existing debt."

Also not a problem was the fact that both of the anchors' leases roll within the next four years. "We still were able to generate tremendous interest in the marketplace with multiple offers being priced in the low 100s [basis points] over treasury range without any additional leasing reserves," says Patrick Brown, another Sonnenblick Eichner principal.