SANTA MONICA, CA-Development of a new high-end, ocean-view condominium project here will likely move forward thanks to a $42.1-million bridge loan that encumbers three properties.
Robert Hervey, EVP and managing director of NorthMarq's Los Angeles office, arranged the highly-structured loan, which encumbers the 55,863 square foot Point Dume Shopping Center in Malibu; Meridian Apartments, a 21-unit complex in Pasadena; and 301 Ocean, the anticipated high-end condominium development in Santa Monica.
Prime Finance in San Francisco was the lender. The loan leveraged all three properties so that Marquis Property Co. Ltd. could acquire the one-acre 301 Ocean for $21 million from Trammell Crow. The site currently houses a boarded-up, 47-unit apartment complex. Marquis Property owns retail, office and residential properties.
The project financing was closed in 60 days and was based on a three-year, interest-only term, with what were termed “significant” non-refundable deposits required to win the acquisition opportunity. The deposit amounts were not disclosed.
“This was a remarkable feat by both the borrower and the lender,” Hervey said in a statement. “The borrower was very astute in negotiating not only with the seller, but parties that controlled 'first rights.' The lender was very creative and able to provide a structure that provided alternatives and optionality required to pull off the acquisition. Additionally, the structure covers the expected needs for moving forward the development of 301 Ocean.”
Hervey tells GlobeSt.com that the 301 Ocean project is anticipated to transform the building into 20 condominiums. Hervey says that “15 will be very high quality and five will be affordable.” The prime location on the corner of San Vicente and Ocean offers unobstructed ocean views, he adds. Construction is expected to start in 2014 and will mark the first condominium project to be built in the last 20 years on Ocean Avenue. Hervey could not provide the estimated renovation costs for the building.
The current plan for 301 Ocean Ave. was developed by architect Howard Laks and designer Michael Lee, the latter named by “Architectural Digest” in 2009 as one of its Top 100 designers. The proposed project is described as “Malibu lifestyle on Ocean Avenue,” featuring what's described as relaxed Mediterranean motifs. Distressed wood, antique doors and fixtures, and French limestone terraces will be part of the renovations, according to Marquis. The units are anticipated at be 4000 to 6000 square feet per unit, with private elevator access available into each residence from individual parking garages.
NorthMarq is the largest privately held commercial real estate financial intermediary in the nation. It provides mortgage banking and commercial loan servicing in 33 offices, with an average of $9.5 billion in annual production volume and servicing a loan portfolio of over $41 billion.
Chris Cortazzo and Ron DeSalvo of Coldwell Banker Previews International will market the units, according to Marquis.
As previously reported in GlobeSt.com, NorthMarq also arranged a $10.5 million mortgage in March for the Hillside Terrace Apartments in Los Angeles.
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