SAN FRANCISCO (April 27, 2020) – Nathan Prouty, managing director, and Andy Slaton, senior vice president, in NorthMarq’s San Francisco office arranged the $75 million permanent refinancing of Mediterranean Village, a multifamily garden apartment property consisting of 508 units located at 2400 Harbor Blvd in Costa Mesa, California.
The transaction was structured with a 10-year term of interest-only payments with a fixed-rate just shy of 3 percent. NorthMarq arranged financing for the borrower, an affiliate of E&S Ring, by working with the existing life insurance company lender to discount the prepayment premium on the existing loan and refinance a low-6 percent rate with a sub-3 percent rate and convert from amortized to interest only payments. This allowed the borrower to pull out a significant amount of equity (3x the existing balance) to fund a variety of capital improvements at the property while maintaining the same level of debt service and distributions to its partners. ”We were fortunate to structure the deal and lock rate prior to COVID-19. As one of our top correspondent lenders, this life insurance company honored their commitment and remained focused and flexible throughout the transaction,” noted Andy Slaton.
The property is adjacent to the Costa Mesa Golf Course along Harbor Boulevard between Orange Coast College and the Harbor Center shopping center. The property’s location allows residents easy access to both the Interstate 405 and Costa Mesa Freeways for easy access throughout Orange County. The community is less than two miles outside Downtown Costa Mesa with an abundance of retail amenities and a Starlight Cinemas Movie Theater. Additionally, the property is only a short drive from the neighboring beach towns Newport and Huntington Beach.