(Mark Your Calendars: RealShare Apartments 2011, October 20 in Los Angeles).
SAN FRANCISCO-Real estate investment firm Johnson Capital has arranged $50 million in financing for South Beach Marina Apartments. The multifamily complex, located in Downtown San Francisco, is owned by a pension fund.
The non-recourse debt, with a fixed-interest rate and a 10-year term, was used to refinance tax exempt bonds, resulting in a complicated and time-consuming closing process. The loan was provided by Principal Life Insurance, which was able to win the deal by providing flexible pre-pay provisions.
Brent Lister and Eric Salveson, both senior vice presidents in the firm’s Los Angeles office arranged the loan. The South Beach Marina Apartments was built in 1984 and contains 414 units in two 14-story towers and a connecting courtyard building. It is located at 2 Townsend, at the intersection of The Embarcadero, along the waterfront.
Lister points out that “There were several aspects of the financing we had to include to make it work for the parties. First, we were able to structure a 10-year loan at a fixed rate, thereby lowering the borrower’s interest rate by over one and a half percent, and we got interest only payments, which provided additional cash flow to the borrower. The loan is advantageous for our client because it locks in today’s low rates for the10-year term, yet maintains flexibility to allow an early prepay if the client were to sell the property during the loan term. Principal was able to provide this flexibility that was not available with an ‘agency’ transaction.”
He adds that, “the financing required an early redemption of HUD-guaranteed, tax-exempt bonds that had been issued in 1984 by the San Francisco Redevelopment Agency and scheduled to be retired in 2019. Despite the additional time this added to the closing period, Johnson Capital and Principal were able to structure a closing timeline and process that accomplished each party’s objective while minimizing risks to the borrower.”
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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.
