LOS ANGELES (August 11, 2017) John Marshall, vice president of NorthMarq Capital’s Los Angeles regional office, negotiated $8,100,000 construction financing for a 63,110 sq. ft. single-tenant 24 Hour Fitness located in Arvada, Colorado. The project’s total cost was $13,760,000 which included significant tenant improvement dollars and the installation of rooftop solar panels.
The borrower, a Los Angeles based developer, engaged NorthMarq to find a construction-to-permanent loan to re-tenant a vacant grocery store with a new 24 Hour Fitness gym.
NorthMarq drew on existing banking relationships to find a six-year and three month (75 months total), fixed rate construction-to-permanent loan with minimal prepayment penalties, no deposit requirements, and minimal structure. The loan features a 5.12 percent interest rate and a 25-year amortization schedule, and did not require an interest rate swap.
“The non-credit tenant ruled out a number of lenders but the sponsor’s multiyear track record with the tenant and low acquisition basis made the deal attractive to multiple banks. Ultimately a regional bank offered the most flexibility, tailored the term to rent bumps on a 20-year lease, and allowed the sponsor to capitalize the significant cost of rooftop solar panels for additional proceeds,” said Marshall.