Stretch Senior Bridge Loan for Big-Box Conversion
The Berry Hill Kmart conversion was one of the most exciting loans McBride Capital has worked on this year. Our client engaged us to procure a high leverage bridge loan for the conversion of the 90,000+ sq ft big box into smaller spaces that were pre-leased to high profile credit tenants.
As with all assignments, our team packaged up the underwriting, demographics, traffic data, sponsorship background, etc. and took it to market. We found that there was a wide range of leverage provided by prospective lenders as well as a wide range of how the loans were priced. There is still very strong appetite among lenders for credit tenant deals with long lease terms. In fact, McBride Capital identified a number of capital sources that would have provided debt on 100% of the capital stack. We also explored a number of options that would have coupled low-cost senior debt with mezzanine debt or preferred equity. Ultimately the best fit for this project from a pricing and leverage perspective was a stretch-senior bridge lender.
It was a pleasure to work with this client, who is extremely organized and have an amazing track record of development projects in the Pacific Northwest. We look forward to the next opportunity to work with them.
The non-recourse, stretch senior bridge loan funded acquisition and rehab costs. The loan was originated by Danny Natsch and Ken McBride.