The Madison Group Arranges a $1.6 Million Cash-out Refinance and $500,000 Revolving Line of Credit on a Gas Station and Convenience Store in Tennessee

The Madison Group (TMG), a nationwide commercial real estate consulting firm, arranged $2,100,000 in financing for a gas station and convenience store property in Tennessee. The transaction included a $1,600,000 cash-out refinance loan and a separate $500,000 revolving operating line of credit, structured at a combined 75% loan-to-value ratio.

The commercial mortgage closed at a 6.50% interest rate with a five-year term and 25-year amortization. The revolving line of credit gives the borrower access to additional capital for operating needs without requiring the entire credit facility to be drawn at closing.

The borrower initially contacted TMG seeking a cash-out refinance of the gas station and convenience store property. After reviewing the borrower’s objectives and anticipated capital needs, TMG identified an opportunity to structure the financing through two complementary facilities.

The $1.6 million mortgage addressed the borrower’s refinancing and immediate cash-out needs. The separate $500,000 revolving line of credit provided additional borrowing capacity that could be accessed as operating needs arise, subject to the credit agreement.

By separating the mortgage from the operating line, TMG helped the borrower avoid taking all available proceeds as funded debt at closing. This approach aligned the financing with when the borrower expected to need the capital.

Financing Summary

·       Property type: Gas station and convenience store

·       Location: Tennessee

·       Total financing and credit capacity: $2,100,000

·       Cash-out refinance mortgage: $1,600,000

·       Revolving operating line of credit: $500,000

·       Combined loan-to-value ratio: 75%, including the mortgage and line of credit

·       Mortgage interest rate at closing: 6.50%

·       Mortgage term: Five years

·       Mortgage amortization: 25 years

‍