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COSTA MESA, CA-Private retail REIT Donahue Schriber has refinanced maturing loans on five of its properties and funded construction at one of the centers with a $252 million loan arranged by the Newport Beach office of CB Richard Ellis Capital Markets. Sharon Kline, a member of the three-person CBRE Capital Markets team that arranged the financing, tells GlobeSt.com that the second and final portion of the loan was due to fund yesterday.
The largest portion of the loan, $222.5 million, has already been funded and covers four of the five properties. The last portion is for the fifth property. The staggered funding coincides with the maturity dates of the existing loans on the properties.
The CBRE Capital Markets team of Kline, Mary McDonald and Rocco Mandala arranged Donahue Schriber's new financing at just under 5.6% with lender Massachusetts Mutual Life Insurance Co. through its agent Babson Capital Management Inc. The financing consists of a fixed rate, interest-only loan for a term of seven years. The loan equates to 75% of value and a 1.5 debt service coverage, a structure that is designed to provide the borrower with maximum flexibility, according to the CBRE Capital Markets team.
Kline calls the loan "a unique structure for a life insurance company," adding that MassMutual "was able to meet the borrower's request for flexibility, as well as providing a competitive rate, which won them the business." The five properties include four in California and one in Arizona, all of them fully leased.
The California properties are the 303,000-sf Fig Garden Village in Fresno, the 249,000-sf Lone Tree Plaza in Brentwood, the 119,000-sf Village Center at Rose in Placentia and the 76,000-sf Pavilions in Sacramento. The Arizona center is the 185,000-sf Summit at Scottsdale in Scottsdale.
The Lone Tree is a power center that was completed in 2004, the Pavilions is a lifestyle center built in 1985 and the Village Center at Rose a neighborhood center that was built in 1996. The Fig Garden is a community lifestyle center that was built in 1956 and acquired in 2005 by Donahue Schriber, which has since renovated the property. The Scottsdale property is a community center that was completed in 2001.
Donahue Schriber is a 38-year-old firm that has been involved in nearly 30 million sf of retail properties. The private REIT owns and/or operates a portfolio of 91 neighborhood, community, power and community lifestyle shopping centers including 18 development properties representing 3.7 million sf. Its operating and development portfolio totals 15 million sf throughout the Western US.
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