AZUSA, CA—Xebec Realty Partners has secured a $28 million senior loan to fund the construction of 10^th Street Center, a three-building, 342,629-square-foot industrial park in Azusa, CA. Xebec purchased the nearly 22-acre site in 2013 and obtained the necessary entitlements for construction.

PCCP LLC funded the senior loan. The firm's VP, Ron Bonneau tells GlobeSt.com, “Xebec was able to acquire a unique site with some prior issues, all of which have been resolved, and successfully entitle it for the planned development. Sizable development opportunities remain sparse in Los Angeles County due to a lack of developable land. The ability to provide financing to a strong borrower on an infill site in a submarket with a vacancy rate below 2%, was attractive to PCCP.”

The non-recourse construction loan has a three-year term and a flexible prepayment and release pricing, with a floating interest rate over LIBOR, according to Bonneau. “The loan covered 80% of the total development costs,” Bonneau adds. The property is located within close proximity to the 605 and 210 freeways. The three buildings will range in size from 75,278 square feet to 179,002 square feet, and will feature 32-foot clear heights and an ESFR sprinkler system.

Although construction is now underway, the process didn't come without obstacles. “The site had some previous challenges, which for many lenders were difficult to overcome,” explains Bonneau. “We pride ourselves on understanding complicated or unique situations. We ultimately were able to underwrite the limited risk from the previous challenges of the site and gain further comfort due to the strong borrower in Xebec, lack of competitive infill properties, and strong demand for new industrial product in Los Angeles County. “ 

This is just one of the development projects that PCCP has funded. Recently, GlobeSt.com reported that Provident Real Estate Ventures LLC received a $43.1 million senior loan from PCCP LLC to renovate and reposition Mayo Clinic Square, a 217,354-square-foot mixed-use project in the heart of downtown Minneapolis.