"Our client required a construction-to-permanent loan to reposition an existing single-tenant office building to multi-tenant medical office that was 50% preleased," said Gregory Nalbandian, managing director of NorthMarq New Jersey, in a statement. "The client was very sensitive to personal guarantees and desired a 75% loan to value upon stabilization."
NorthMarq was able to structure a two-year, sub-5%, no floor, interest-only construction loan with minimal guarantees that burn off upon NOI and debt service coverage covenants at stabilization. Jim Poole, also of NorthMarq, noted that, "We successfully negotiated funding nearly 80% of the loan proceeds at closing." At stabilization, the loan rolls into a five-year, fixed-rate permanent paper.
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