SAN LEANDRO, Calif. – Continental Partners recently secured financing for a 34,149 square-foot, mixed-use building in the San Francisco Bay Area submarket of San Leandro, California. The non-recourse bridge loan was secured by J.M. Grimaldi, Executive Vice President at Continental Partners, on behalf of the Sponsor, an Oakland-based syndicator.
The loan facilitated the acquisition of the four-story building as well as value-add renovations to the asset. The property has been fully leased to Wells Fargo, who will offer consumer-facing retail on the ground floor and establish corporate offices on the additional floors, notes Grimaldi.
“With its central downtown location in the growing East Bay submarket of San Leandro, in easy walking distance of the BART, this is an excellent investment property,” says Grimaldi. “That said, the Sponsor was struggling to find a lender that could meet its financing requirements, due to the asset’s 28 percent occupancy rate and minimal in-place cash flow at the time.”
According to Grimaldi, San Leandro is increasingly attracting businesses seeking an alternative to sky-high office rents in San Francisco and Oakland, while offering easy commutes for employees living in those areas, further driving the property’s long-term investment potential.
“By positioning the financing request correctly and demonstrating these strong fundamentals and future growth, Continental Partners was able to exceed the Sponsor’s requirements by sourcing a loan sized at 80 percent of the total project cost or 75 percent of appraised stabilized value,” continues Grimaldi. “Further, we were able to work closely with the lender to minimize the yield maintenance prepayment penalty, structure an interest reserve, and secure additional future funding opportunities. Ultimately, the Sponsor received the required funding and leased the property to a high-credit tenant.”
The total consideration of the loan is $6.5 million.
The property, which was originally constructed in 1972, is located at 1290-1298 East 14th Street in San Leandro, California.
About Continental Partners
Continental Partners is a leading national mortgage banking firm based in Los Angeles that provides Market-Smart capital and financial services to real estate owners and developers nationwide. Since its inception, Continental Partners has arranged mortgage loans ranging from $2 million to $200 million for multifamily, office, retail, industrial, hotels, mixed-use and self-storage properties.
With its deep expertise in sourcing competitive debt, mezzanine, and joint venture equity, Continental Partners has established long-standing relationships with both lenders and clients, and continues to deliver sound financing solutions to maximize the value of real estate holdings. The firm offers all major loan types, including fixed rate, floating rate, mezzanine, bridge and construction.