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Retail Center financed by TMG

The Madison Group arranges $1,120,000 Loan for a Retail Condo

Tags: Retail Financing, Commerical loans for Retail Centers
Friday, Nov 02, 2018
by Angela Kesselman

The Madison Group (TMG), a leading source of retail financing nationwide, arranged the $1,120,000 loan for the purchase of a retail condominium unit in Park City, Utah.  The borrower’s goals were to purchase the property with a short-term lease in place. TMG secured the financing with a fixed rate loan of 6.5% with 5-year resets, a 15-year term and 25-year amortization.

The property, which was built in 1994, is ideally located in Park City, and is a 4,865-square-foot, single story in-line retail condo. The buyers, a multiple member LLC, currently own Suites B, D and E in this retail strip center.  After completion of this purchase, the group will own more than 51 per cent of the project and control the HOA. The seller will remain as the tenant for six months. 

Among the challenges TMG faced in securing the financing, the borrowing group is based out of state and the seller wanted to stay in the property as a tenant for six months after close.  With a short-term lease in place, TMG needed to find a lender that understood the low vacancy and growth in this particular market and was confident a new long-term tenant could be put into the space.   

TMG found a credit union willing to offer a loan that allowed the borrower to purchase the property with a short-term lease with no prepayment penalty.  TMG closed within a 30-day period, because a 1031 exchange on the seller’s side of the transaction had to be met.  The appraiser confirmed the shortage of retail inventory in the market mitigating the short-term lease with the lender. 

This loan satisfied all of the buyer’s needs,” said Angela Kesselman, TMG’s associate director of Finance.  “With the purchase of this unit, along with the existing ownership of the other units, the buyers have a long-term plan for the property that they will now be able to execute with a flexible lender in place,Kesselman said.

The financing was arranged by Angela Kesselman at The Madison Group.