LOS ANGELES-Two suburban retail centers in Fullerton, CA, and Lacey, WA, have secured a combined total of $71.7 million in CMBS loans, GlobeSt.com learns in this exclusive story. Orangefair LLC received $44.8 million for its namesake retail center located at East Orangethorpe and South Harbor Boulevard in Fullerton. The LLC took advantage of current lower interest rates by refinancing before the maturity of the loan. The Landing at Hawks Prairie LLC received the remaining $26.9 for its namesake retail center in Lacey, WA, to pay off the construction loan from second development phase and to consolidate the existing first trust deed with the maturing construction loan.

The Hudson Team of George Elkins Mortgage Banking Co. secured the loans on behalf of both clients, and chose to utilize CMBS loan structuring. “Both of the loans had a good deal of lease movement within the term of the loan, which was 10 years, and as a result, there needed to be a good deal of structuring to provide adequate reserves for the lease maturities,” Jeffery M. Hudson, Hudson Team principal, tells GlobeSt.com. “After working with multiple lenders on these projects, we found a lender who could put together the best overall program, including loan structuring that did not hurt the cash flow but at the same time provided adequate reserves for DILC.”

Retail center activity has been strong recently. GlobeSt.com has reported several new retail centers beginning construction, including the Juanita Tate Marketplace in South Los Angeles, which is a $21 million, 77,000-square-foot project. Hudson attributes the strong activity in part to 10-year financing that is now coming due. The second reason, he explains, is due to “the recent dip again in long-term interest rates. Borrowers are making the move to refinance even before their loans mature to take advantage of the lowest rate in the foreseeable future.” He adds that we are currently in a window, but should expect interest rates to continue to rise.