"Getting the loan was a colossal task," says Todd McNeill, a senior director with MCA. "A $30 million commitment is almost unheard of in this market. We had to go through many gyrations with the lender, but we got it done."
McNeill will not reveal the name of the lender, but he says it is the same regional Texas bank that provided financing for phase I. A records search shows the original construction loan was provided by Dallas-based American National Bank of Texas. Though the MCA exec says the lender indicated at the time of the first loan that it would provide a Phase II construction loan, the subsequent changes in the economic climate made the deal less than certain.
"We began the process in February, so it's taken almost a year to get done," McNeill tells GlobeSt.com. "We had to dot all the I's and cross the T's, then check everything twice. It was definitely not a slam dunk." Surprisingly, he continues, the rates ended up being quite low, with the mini-perm priced at 275 basis points above the Federal Home Loan Three-Year rate and the construction loan priced at 250 basis points above LIBOR. "If I'd had to go find a new lender today, it would have been significantly more costly--if I could even have found someone willing to take it on," he adds.
According to McNeill, the lending probably would not have come through had it not been for the successful effort by the project leasing team of Jeff Kaste and Andy Burnett from the Tulsa office of Sperry Van Ness. They have leased 98% of the space in 125,000-square-foot first phase and 40% of the identically sized second phase, including 21,000 square feet taken by Lewis & Clark Outfitters and 12,000 square feet taken by McDermott's Grill. The tenant roster for phase I, which was completed in 2005, consists primarily of a collection of local and regional specialty stores and restaurants.
Construction on phase II has already begun, with completion expected in late 2009. Earlier this month the project's developer sold 9.68 acres at the site that was set aside for a multifamily project to two other Tulsa developers, Richard, Stuart and John Price, for $1.8 million. They plan to build a 204-apartment complex on property.
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