Metrogroup Secures Acquisition Financing for OC Asset

The company landed financing for 46 percent of the purchase price. The buyer recognized the property’s potential for value creation, given the nearby $450 million project underway.

Orangewood Business Plaza, Orange, Calif.
Orangewood Business Plaza, Orange, Calif.

MetroGroup Realty Finance secured $3.9 million in permanent acquisition financing for Orangewood Business Plaza, a three-building industrial/office business park in Orange, Calif. The financing represented 46 percent of the 8.5 million purchase price. Lee & Associates represented both the buyer, Betty L. Davies Family Ltd. Partnership, and the seller, Orangewood Business Plaza LLC.

The 49,880 square-foot business park consists of one office building and two flex/industrial buildings located at 1717 and 1745 W. Orangewood Ave. and 571 N. Poplar St. The buyer plans to reposition the asset built in 1977, which was fully occupied at the time of sale. Another Orange County industrial asset 10 miles away traded recently for $12.2 million.

Adjacent to $450 million development

LT Platinum Center, Anaheim, Calif.
LT Platinum Center, Anaheim, Calif.

The project is located near Angel Stadium of Anaheim, an area which is undergoing tremendous revitalization attracting long-term investors, according to MetroGroup Vice President J.D. Blashaw. Blashaw and Ivan Kustic arranged the financing.

A new $450 million mixed-use development in Anaheim, Calif., is underway less than a mile from Orangewood Business Plaza. The project was approved late last year and is set for completion by 2022, according to The Orange County Register.

 

 

LT Global Investment’s 15-acre LT Platinum Center will include:

  • 75,000 square feet of office buildings;
  • a 95,000-square-foot outdoor entertainment center;
  • 120,000 square feet of dining;
  • 218,000 square feet of retail;
  • a 26-story, 200-key hotel;
  • a 30-story, 400-unit residential tower; and
  • a 1.5-acre urban park.

Increased cash flow

Given the strong opportunity for future value creation, the sponsor needed a loan structure that would provide flexibility and increase initial cash flow,” said Blashaw in prepared remarks. MetroGroup first worked closely with the sponsor and the seller to negotiate an additional $4 million using the sponsor’s existing portfolio of income properties as temporary security in anticipation of selling an existing asset. The company secured the five-year, fixed-rate loan at a rate of 4.6 percent. The interest-only payments for the first 18 months of the loan will increase cash flow, allowing for asset improvements, which will bring rents up to market level.

 Images courtesy of MetroGroup Realty Finance and LT Platinum Center