Transaction Overview
Compass Commercial Mortgage, Inc. (“Compass”) served as the exclusive financing consultant to James Business Park (“JBP”), arranging permanent refinancing on its newly developed light-industrial park and a working capital line of credit for its related operating company. The property is located in Westlake, Florida.
The project consists of two (2) light-industrial buildings totaling 145,000 ± rentable square feet, situated on 9.226 ± acres. Building I comprises 135,000 ± rentable square feet, features a 32-foot clear height, and includes two (2) 12′ × 24′ overhead doors and forty (40) 9′ × 10′ overhead doors. Building II contains 10,000 ± rentable square feet, features a 20-foot clear height, and includes eight (8) 9′ × 10′ overhead doors.
At closing, the property was 100% leased and occupied by eight (8) tenants, including a significant related operating company occupying approximately 39% of the premises.
Compass Role
JBP engaged Compass to structure and secure permanent refinancing for the real estate and a working capital line of credit for its related operating company. The Borrower’s existing second mortgage, originally structured utilizing an SBA 504 debenture, was nearing maturity, and the Borrower no longer satisfied the owner-occupancy requirements necessary to remain eligible for SBA financing.
An additional challenge arose when the financial institution with which Compass and the Borrower had spent six (6) months underwriting, structuring, and negotiating the refinancing declined the loan one (1) week prior to its scheduled loan committee approval. This challenge was successfully overcome through the delivery of a comprehensive, decision-ready loan package, the creation of a competitive lending marketplace, and the proactive management of the process at every stage of the request. Compass immediately engaged another bank that had seen the loans when we were originally marketing the loan requests and closed the financing within 40 days, just before the year-end holidays, ultimately securing higher loan proceeds and improved loan terms than those initially proposed by the original lender.
The final structure included:
- $23.0 million permanent real estate loan, representing 75% loan-to-value, to refinance the existing first and second mortgages and reimburse the Borrower for tenant improvements made to the leased space.
- $3.0 million working capital line of credit to the operating company, enabling consolidation of business debts incurred during development and stabilization of the property.
- 12-month interest-only period on the permanent real estate loan, enhancing near-term cash flow and operating flexibility.
About Compass
Compass Commercial Mortgage, Inc. is a three-decade-old, full-service boutique commercial mortgage brokerage and consulting firm serving borrowers since 1996. Compass specializes in the professional underwriting, structuring, negotiation, and placement of commercial real estate debt throughout the State of Florida and nationwide.
We believe commercial real estate finance is a full-time active process. Our team remains fully engaged from initial consultation through loan closing, delivering superior execution and outcomes for our clients, often resulting in lower interest rates, improved loan structures, reduced closing costs, and expedited closings.
If you’re in the market for commercial real estate financing for purchase, construction, or refinancing, please contact us for a free initial consultation at (561) 626-3511 or email us at info@compassmtg.com.