SPOKANE, WA-GlobeSt.com exclusively learns that Cohen Financial obtains financing for two deals here in Spokane. The first is that it secured a $6.3-million loan for the refinancing of the 115-unit Beau Rivage Apartment building on the Spokane River near Centennial Trail. It also secured an $8-million loan to refinance the 43,000-square-foot class A Iron Bridge III office building located on the Spokane River just east of downtown Spokane.
The Beau Rivage Apartments are located at 4909 E. Upriver Dr. and covers 134,200 square feet. The one, two and three bedroom apartments are fully leased. Peter Norrie, the managing director in Cohen Financial’s Portland office, secured the loan, which equated to a 75% loan-to-value and carried a 10-year term and 30-year amortization schedule. The loan was priced over the 10-year US Treasury.
The lender for the $6.3-million loan is a Government Sponsored Enterprises (GSE) lender. The borrower is Beau Rivage 115 LLC, and its principal is a long-standing Cohen Financial client. “This refinance was distinct in today’s market because the borrower was able to pull out a significant amount of cash with the new loan proceeds,” says Norrie. “The loan that was paid off was also originated by Cohen Financial five years ago through a correspondent life company. But in today’s market, as a general rule a GSE lender is going to be able to provide more loan dollars and better pricing than a life insurance company so we took this route for our client.”
Cohen Financial is in the process of refinancing the final 78 units of the phased project, and hopes to close the loan in the next 60 days.
Commenting on the Spokane commercial real estate market, Norrie tells GlobeSt.com that historically, “Spokane is a fairly steady market. It does not experience the extreme highs and lows other markets do in good and bad economic periods.”
Norrie also secured the $8-million refinancing of the newly constructed office building. It is a fixed-rate 80% loan-to-value three-year term loan with a 15-year amortization schedule. The borrower is Iron Bridge III LLC of Spokane. The lender is U.S. Bank.
“The key to getting this loan done was the 80% leverage,” says Norrie. “To secure that, the lender needed faster pay down on the loan so we structured a 15-year amortization and three-year fixed-rate term that carried an interest rate near 5%.”
The Iron Bridge III building is occupied by two Government Services Administration tenants on long term leases. The credit of the tenants was another critical factor in securing financing.
“In today’s market, it is no secret that 80% LTV on commercial loans is very difficult to secure,” adds Norrie. “We accomplished this by working with U.S. Bank and our client to structure a loan that enabled them to advance the higher leverage loan dollars and have a comfortable loan per square foot on the building at maturity.”
Norrie tells GlobeSt.com that he expected modest improvements in vacancies and rental rates for both commercial and multifamily properties for the rest of 2010 and 2011. On the commercial real estate lending side of the equation, during the same period of time, “We expect to see increased liquidity in the capital markets, tighter pricing and perhaps slightly higher leverage than we are seeing today,” he explains.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
