Lender Focuses on Deal Metrics, Not Headlines

The short-term bridge transaction was structured with a four-year term plus extension options.

HOUSTON—Acquisition financing for Tower Park North , a 181,000-square-foot office building located at 10700 North Freeway was arranged on behalf of an institutional client by NorthMarq Capital ‘s Houston-based regional office. The short-term bridge transaction was aggressively structured with a four-year term plus extension options on an interest-only basis. The loan amount was undisclosed. The non-recourse nature of the loan, combined with an attractive fixed rate, creative structure and earn-out potential met all the borrower’s demands on this acquisition financing, says Warren Hitchcock , vice president of NorthMarq, who was the liaison on the financing. “NorthMarq successfully financed this Greenspoint office building during the worst of the oil price collapse with one of our correspondent fixed-rate bridge lenders,” explained Hitchcock. “Despite this property being located in one of the more challenged submarkets, oil dropping below $30 per barrel, and the occupancy at closing moving under 20%, NorthMarq and its lending relationship were able to close as promised with a fixed-rate non-recourse bridge loan. This loan will allow the new owner to improve the property, renovate the building, add parking, as well as earn-out TILC funds, capital expenditure funds, interest reserves and cash flow short fall reserves without any interest paid until the funds are drawn down upon and used.” Tower Park North is a class-B building with class-A amenities located in the Greenspoint/North Belt West submarket and offers a large tenant convenience and autonomy. It is a 181,647-square-foot, 10-story, black glass building, providing excellent visibility from Interstate 45 with great views of downtown and other parts of the city’s landscapes in the North Belt submarket of Houston. Access to George Bush Airport is 10 minutes away, downtown is just 20 minutes south and the Beltway access is immediate from the Interstate 45 North feeder road. It is adjacent to many restaurants and within one mile of other retail conveniences. Hitchcock tells GlobeSt.com: “Greenspoint has high vacancies due to Exxon Mobile’s exit, leaving 1 million square feet of space. And, at the beginning of the year, there was a 75% decrease in the commodity price. The macro-sense thinking is ‘with oil goes the market,’ however, the lender took a contrarian viewpoint, focusing on the metrics of the deal rather than the headlines in financing this property.” Built in 1980 by well-known developer, Marvy Finger , and renovated in 2010, it offers lobby finishes with Texas granite throughout and efficient floor plates of slightly less than 19,000 square foot per floor. With 144,659 square feet of total space available, large view blocks of 125,812 square feet are available, along with building signage. The building has a conference facility and covered parking with a ratio of 3.1 to 1,000. Tenant amenities include on-site deli, conference facility and on-site guard service/key card access. Further renovations are planned, including a new lobby, surface parking, roof and walkway from the garage, along with refurbished interior hallways and restrooms, and a reconfigured garage. The leasing agents are Michelle Wogan and Evelyn Ward , CCIM, of Transwestern .