HFF Arranges $114M Financing for Cousins’ 775 KSF Office Tower in Atlanta
- Sep 17, 2013
When obtaining the billion dollars in cash for a recent office portfolio purchase, Cousins grabbed a little bit from here, a lot from there and additional funds from the $114 million financing of its 774,000-square-foot Promenade office building in Atlanta. Northwestern Mutual provided a nine-year, fixed-rate non-recourse mortgage loan for the premier asset.
Having shelled out $135 million for Promenade in November 2011, Cousins could have sold the 38-story tower for more than the $114 million in financing it obtained for the asset, but such a move was not part of the company’s big picture in Atlanta.
“Promenade has been a wonderful investment for Cousins and we’re confident it’ll continue to be a great asset for years to come,” Cameron Golden, vice president of investor relations with Cousins, told Commercial Property Executive. “It also provides us with a trophy offering in in all three of Atlanta’s urban submarkets along the Peachtree Corridor.”
In addition to Promenade in Midtown, Cousins owns Terminus in Buckhead and 191 Peachtree in Downtown.
Commercial real estate and capital markets services provider HFF arranged the financing for Promenade on Cousins’ behalf and likely had little trouble securing offers, as the property, originally erected as a build-to-suit for AT&T in 1990, ticks all the right boxes. There’s the Class A designation, the respected sponsorship and the location in Atlanta’s Midtown submarket, where next year’s balanced conditions are expected to change to landlord-favorable conditions in 2015 and 2016, according to a report by commercial real estate services firm Jones Lang LaSalle.
And then there’s Promenade’s tenant roster; it’s not full just yet, but the path it’s taken since coming under Cousins’ ownership less than two years ago is almost as good as a guarantee of even higher occupancy levels in the very near future. “Leveraging our redevelopment skills, we implemented a capital improvement project– which included a new fitness center, bistro, and a significant re-work of the entrance area – that has driven very positive results,” Golden said. “The building now is 88 percent leased, up from 58 percent at the time of purchase, with very strong momentum.” That’s probably something lenders really like to hear.