February 2015 – Briefs/Finance

TPG Real Estate Acquires $2.5B Loan Portfolio from Deutsche; Citibank Provides $36.5M for Philly Office Acquisition; Meridian Arranges $135M in Financing for World’s Tallest Holiday Inn; HCP Prices $600 Million Senior Unsecured Notes Due 2025; Spirit Closes $510M A+ Rated Net-Lease Mortgage Notes; HFF Secures $140M for Omni San Diego; Apollo Completes More Than $1.5 B of CRE Debt Transactions in 2014; GE Capital Agents $500M Credit Facility for Brookdale Senior Living.

TPG Real Estate Acquires $2.5B Loan Portfolio from Deutsche

TPG Real Estate has acquired a majority stake in a $2.5 billion portfolio of high-yield real estate loans from Deutsche Bank’s Special Situations Group. Terms call for TPG to acquire a 75 percent stake in the portfolio, with Deutsche Bank retaining the 25 percent minority stake. No additional terms were disclosed. The portfolio is comprised of 57 performing first-mortgage loans on properties in gateway markets across the U.S., primarily in New York and Los Angeles. The loans have a weighted average life of less than three years and an average size of approximately $40 million. Property types include apartment, office, condominium, hotel and industrial assets.

Citibank Provides $36.5M for Philly Office Acquisition

Philadelphia continues to rise among the ranks of top commercial real estate investment markets. Citibank has provided $36.5 million to Nightingale Properties for its purchase 1635 Market St., a Class A office and retail asset in the city’s CBD. JLL’s Capital Markets group arranged the sale and financing. The loan breaks down into $30 million for the acquisition and $6.5 million to enhance property amenities. The deal represents Nightingale’s fourth investment in the Philadelphia CBD since 2011. JLL executive vice presidents Doug Rodio and Jim Galbally, and vice president John Plower led the JLL team on the sales transaction. Managing director Dustin Stolly and vice president Aaron Niedermayer led the financing efforts.

Meridian Arranges $135M in Financing for World’s Tallest Holiday Inn

Meridian Capital Group has facilitated a $135 million mortgage to refinance the Holiday Inn Manhattan-Financial District, a 50-story limited-service hotel property in New York City, on behalf of borrowers Sam Chang and Jubao Xie. The two-year loan was provided by a national balance-sheet lender and features a competitive floating-rate with interest-only payments for the full term. The Holiday Inn Manhattan-Financial District opened this past October at 99-103 Washington St., just two blocks south of the World Trade Center. It features 492 keys and is the tallest Holiday Inn in the world.

HCP Prices $600 Million Senior Unsecured Notes Due 2025

Healthcare Property Investors Inc. has priced an offering of $600 million of 3.40 percent senior unsecured notes due 2025. Citigroup Global Markets Inc., Credit Agricole Securities (USA) Inc., Credit Suisse Securities (USA) L.L.C. and RBS Securities Inc. acted as joint book-running managers for the offering. The price to investors was 99.19 percent of the principal amount of the notes representing a yield-to-maturity of 3.497 percent. Net proceeds from the offering after expenses are approximately $589.4 million and will be used to repay the portion outstanding under the REIT’s $2 billion revolving line of credit, which was $105 million as of Jan. 12, 2015. They will also be used to repay HCP’s $200 million 6 percent senior notes due March 2015 and the $200 million 7.072 percent senior notes due June 2015. The remainder will be used for general corporate purposes, including future acquisitions, investments or repayment of other indebtedness.

Spirit Closes $510M A+ Rated Net-Lease Mortgage Notes

Subsidiaries of Spirit Realty Capital have issued $510 million worth of net-lease mortgage notes under its Spirit Master Funding securitization structure. The issuance was comprised of two classes of notes that were each rated A+ at issuance by Standard & Poor’s Rating Services, and have a blended coupon rate of 4.423 percent, with a weighted average life of 9.4 years. Spirit’s Master Funding program provides the company with a platform to lock in fixed-rate capital to match-fund its acquisitions in real estate net leased to middle market companies.

HFF Secures $140M for Omni San Diego

HFF has secured $140 million in financing for the Omni San Diego, a 511-key luxury, convention center hotel in San Diego. Working on behalf of the borrower, a joint venture between TRT Holdings and JMI Realty, HFF arranged the 15-year, fixed-rate loan through AIG Investments. Proceeds from the financing will be used to refinance existing debt on the hotel, which is located at 675 L St. in San Diego’s Gaslamp Quarter. The 200,000-square-foot hotel is directly across Harbor Road from the main entrance of the San Diego Convention Center and is within walking distance to more than 100 restaurants, galleries and boutiques. The Omni San Diego was built in 2004 and renovated in 2013.

Apollo Completes More Than $1.5 B of CRE Debt Transactions in 2014

At year-end of 2014, Apollo Commercial Real Estate Finance Inc. closed an $82.5 million mezzanine loan ($49 million of which was funded at closing) for the development of a mixed-use property on the Upper West Side of New York. When complete, the asset will deliver 247 for-sale condos, 116 affordable apartment units and about 90,000 square feet of commercial space. The floating-rate, mezzanine piece has a three-year initial term with two one-year extension options and supplements an $500 million first mortgage loan. The deal marked the firm’s commitment to invest more than $1.1 billion of equity into $1.5 billion of transactions in 2014, the Apollo’s most active year since inception.

GE Capital Agents $500M Credit Facility for Brookdale Senior Living

GE Capital’s Healthcare Financial Services business has agented a $500 million credit facility for Brookdale Senior Living Inc. in what is their largest transaction together so far. HFS was administrative agent and GE Capital Markets was sole lead arranger on the transaction. The funds can be used to finance acquisitions, fund working capital and capital expenditures, and for other general corporate purposes. Brookdale currently operates nearly 1,150 independent living, assisted living, dementia care and continuing care retirement centers in 46 states.