Summary: The Madison
Group (TMG), a leading local lending source for construction financing, arranged the $2M construction loan for the
buildout of two spec retail properties located in the Utah.
The buyers of two pads came to TMG for a purchase money loan
on two parcels, one that was gray shell and the other that was vacant. The seller had plans in place for
construction on the empty pad. They
negotiated a long escrow, while looking for tenants for the spaces.
The borrowers goals were to buy the properties “as is” and
build out the space as needed. Retail
has been a difficult property type to finance during the pandemic.
TMG was able to source a lender that would allow them to
fund the purchase and the TIs on the first building with one LOI in place for
50% of the space. The lender closed on
this piece first, then closed on the purchase of the empty pad with a
construction loan. The buyers negotiated a lease for 100% of the space with a
local restaurant. TMG was able to act
quickly and get the lender and the appraiser on board to finish out both loans
and complete the sale along with the construction loan.
Location: Utah
Property: Two retail
buildings
Loan Amount: $2,000,00 combined
Interest Rate: 4.25%
Loan Terms: 1 year
construction at prime plus 2% with a takeout loan of 4.25% on a 15 year term,
with 5 year rate renewals.
Amortization: 25 Years
Prepayment: None