George Smith Partners Secures Refi for SoCal Retail Center
- Mar 16, 2017
Los Angeles—George Smith Partners has secured $30 million in refinancing for Plaza de Hacienda, a 156,000-square-foot grocery-anchored retail center in the La Puente submarket of Los Angeles. The financing was arranged by Shahin Yazdi, principal & managing director for George Smith Partners .
The sponsor, Optimus Properties LLC, had requested a fixed-rate loan with the goal of refinancing its maturing loan for this regional retail center. The sponsor plans to perform capital improvements as needed, and maintain the retail center as a high-profile, cash-flowing asset.
Anchored by Food 4 Less, the center is also home to Ross, Big 5 and Jack in the Box. The challenge with the refinancing deal was that many of the anchor tenants had leases that were set to expire within the next few years.
“By demonstrating the strength of this stabilized asset, which has historically maintained nearly 100 percent occupancy and a strong roster of national credit tenants, we were able to secure competitive cash-out refinancing and achieve a debt coverage ratio of 1.23 and a debt yield of 7.75 percent,” said Yazdi in prepared remarks. “The property’s grocery-anchor tenant, coupled with its prime location in a dense submarket of Los Angeles with high traffic counts, were strong selling points that enabled us to secure competitive rates on behalf of our client.”
The firm secured the $30 million loan from a CMBS lender within 40 days from the time of application. The 10-year loan was structured with a loan-to-value of 65 percent with a five-year interest-only period, followed by an amortization of 30 years. The rate was fixed at the 10-year swap plus 2.53 percent with a 1.23 debt coverage ratio and 7.75 percent debt yield.
The property is located at 1735-1869 N. Hacienda Blvd. in La Puente, Calif., south of Interstate 10.
Image courtesy of George Smith Partners