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$6.2M refinance of a portfolio of NNN properties in Texas

Tags: NNN Financing, Nonrecourse loans, Portfolio Loans
Wednesday, Apr 28, 2021
by Angela Kesselman
The Madison Group (TMG), a leading national source for NNN property financing, arranged the $6.2M non-recourse refinance of a portfolio of Comerica Bank branches and a KFC.  The client that had a CMBS loan coming due.  TMG was able to secure financing with a 30-year amortization at 3.75% on a 5-year fixed rate loan.  The client also has the option to fix for an additional 5 years once the lease options had been signed.

The properties are located throughout the Texas metroplexes.  Most of the properties have a 5-year remaining lease term.  CMBS financing had been put in place 5 years ago, as the real estate investment group had planned on a shorter hold time. 

The sponsors came to The Madison Group requesting a non-recourse rate and term refinance loan.  They wanted a longer amortization to increase cash flow and the best available rate.  Due to the short nature of the remaining leases, and the uncertainty in the market towards bank branches, many lenders were not viable options for this refinance.

TMG sent the financing package to several of their trusted lenders.  Along with excellent rate and terms, TMG also negotiated 3 years of interest only for the sponsors, along with the ability to transport the debt to a new property, if any were sold during the loan term.   The cost of the loan was significantly less than CMBS debt and closed as quoted with a nice permanent loan in place.

Location:  Texas

Property:    Bank locations along with a KFC

Loan Amount: $ 6,200,000

Interest Rate:  3.75%

Term:  10 Years

Amortization:   30 Years

Prepayment:   3/2/1 or ability to transfer debt to another property

LTV:  60 %

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