October – Briefs/Finance

Avalon Closes $126.5M in Construction Financing; Time Equities Lands $398M to Start Manhattan High-Rise; ING Sells $1.6B of CRE Loans to Wells Fargo; MetLife Extends $235M in Financing for 974 KSF Houston Office Building; Behringer Harvard M-F REIT I to Become Self-Managed; LTC Properties Enters into $141M Mortgage Agreement; Northwestern Mutual Provides Gables Residential with $233M Refinance; Prometheus Gets $188M Mortgage for M-F Project in Silicon Valley.

Avalon Closes $126.5M in Construction Financing

1013_Briefs_Finance_2North American Properties – Atlanta Ltd., in a joint venture with Sarofim Realty Advisors, has closed construction financing for its Avalon mixed-use project in Alpharetta, Ga. The partnership secured $126.5 million in financing for Phase I, comprising an $86.5 million syndicated senior loan by Wells Fargo Bank and Bank of America accompanied by a $40 million mezzanine loan provided by JP Morgan Asset Management. Eastdil Secured arranged the financing package. Vertical construction began immediately after the transactions closed. October 2014 will mark the grand opening of Avalon, an 86-acre development with more than 500,000 square feet of retail, a 12-screen theater, boutique and full-service hotels, Class A office, single-family residences and luxury rental homes in a walkable, connected community.

Time Equities Lands $398M to Start Manhattan High-Rise

Time Equities has secured $288 million in construction financing for 50 West St., a 63-story residential condominium tower that will break ground in Lower Manhattan this fall. In addition to the construction financing, Time Equities’ joint venture partner Elliott Management, also of New York, is investing $110 million in equity. The project’s current estimated total cost is about $500 million.

Completion is planned for 2016. The $288 million in construction financing is from a loan syndication effort led by PNC Bank. The lending group also includes Wells Fargo, M&T Bank, Union Bank, MidFirst Bank and Emigrant Bank.

ING Sells $1.6B of CRE Loans to Wells Fargo

As part of the ongoing divestiture of its U.S. commercial real estate lending business, ING Real Estate Finance (USA) L.L.C. has agreed to sell 29 loans in the United States, with a total remaining balance of $1.6 billion, to Wells Fargo Bank N.A. As part of ING Group’s “back to basics” strategy initiated in 2010, the company has been splitting its real estate activities and transferring individual entities internally, divesting of them or winding them down. ING REF announced in September 2012 that it would manage down its U.S. property-lending business. The portfolio being sold consists entirely of performing loans and represents about half of ING REF’s total U.S. loan portfolio.

MetLife Extends $235M in Financing for 974 KSF Houston Office Building

The real estate investment department of MetLife Inc. has closed a $235 million loan secured by BG Group Place, a 973,800-square-foot office high-rise in downtown Houston, for a partnership advised by Invesco Real Estate. The 46-story building at 811 Main St. is the newest Class A office tower in Houston’s CBD and is LEED Platinum certified. The borrower was BG Holdco L.L.C.

Behringer Harvard M-F REIT I to Become Self-Managed

Behringer Harvard Holdings has entered into contractual agreements that kick off the process of Behringer Harvard Multifamily REIT I Inc. becoming a self-managed entity. The transaction is structured to give the multi-family REIT time to develop its own internal resources capable of replacing services currently provided by Behringer Harvard. The management team remains essentially the same, though five executives who have been solely dedicated to the REIT as employees of Behringer Harvard are now employees of the REIT. In addition, Robert Aisner, who will remain an employee of Behringer Harvard, will continue in his role as CEO of the REIT until the self-management process is completed. At that time, Mark Alfieri will become CEO.

LTC Properties Enters into $141M Mortgage Agreement

LTC Properties Inc. has entered into a $141 million mortgage loan agreement with affiliates of Prestige Healthcare. The loan, which is secured by 15 properties with 2,092 skilled-nursing beds and 24 independent-living units in Michigan, is for a term of 30 years and will bear interest at an initial rate of 9.41 percent for five years, escalating annually thereafter by 2.25 percent. LTC Properties Inc. anticipates funding approximately $126 million of the aggregate loan amount during the fourth quarter of 2013, with additional forward commitments of $12 million for capital improvements and as much as $3 million for short-term working capital. Prestige Healthcare is a Louisville-based operating company with approximately 2,500 beds in seven states.

Northwestern Mutual Provides Gables Residential with $233M Refinance

Northwestern Mutual has refinanced a $233 million tranche of a $460 million portfolio loan secured by 19 apartment communities located in four states across the Sun Belt and West Coast. Gables Residential was the borrower. The 19 communities include three communities with 1,086 apartment homes in Atlanta; two communities with 512 apartment homes in Austin; three communities with 481 apartment homes in Dallas; four communities with 1,050 apartment homes in Houston; four communities with 1,114 apartment homes in Florida; and three communities with 412 apartment homes in Southern California.

Prometheus Gets $188M Mortgage for M-F Project in Silicon Valley

Prometheus Real Estate Group has secured a $188 million financing deal for Mansion Grove, a 1,000-unit apartment community in Santa Clara, Calif., in the heart of Silicon Valley.  Commercial real estate financial intermediary NorthMarq Capital arranged the first mortgage refinancing on the borrower’s behalf, relying on its relationship with TIAA-CREF and Allstate Life Insurance Co. Mansion Grove is not your typical multi-family property. The complex, developed in three phases ending in 1990 and expanded in 2010, encompasses 855,600 square feet at 502 Mansion Park Drive and spans 25 acres.