Eastern Union, one of the country’s largest commercial real estate mortgage brokerages, has arranged a $8,187,500 loan for the new owner of South Crater Square and Pinehill Plaza in Petersburg, VA. The single-story retail centers, which total 192,510 rentable square feet in size, are situated opposite each other on South Crater Road.
Marc Tropp, a senior managing director with Eastern Union, arranged financing for the acquisition, which carried an overall price tag of $10,250,000.
The acquisition component of the loan — equaling $7,687,500 — represented a 75-percent loan-to-cost ratio. The bank, a traditional, balance sheet lender, provided an additional $500,000 loan toward tenant improvements and leasing commissions. This element of the loan was held back for future use once the properties have leased additional space.
Overall occupancy of the two assets equals 58.9 percent, with South Crater Square at an 83-percent rate and Pinehill Plaza at an occupancy level of 29 percent.
Retail properties with this relatively low occupancy level normally do not attract financing, according to Mr. Tropp. Lenders, he said, typically refrain from supporting retail projects with occupancy levels below 75 percent.
“To close this transaction, Eastern Union leveraged our strong working relationships with scores of lenders across the United States,” said Mr. Tropp. “In addition, we successfully demonstrated the strength and experience of the borrower, a long-time client. That’s how we were able to deliver financing for assets that might not normally appeal to lenders.
“It also isn’t highly common for balance sheet lenders to invest in improvements,” he said.
The interest rate on the full-recourse loan equaled 3.6 percent over a five-year term, with twelve months of interest-only payments.
The borrower was Carl Verstandig, president and CEO of America’s Realty, which is based in Pikesville MD.
About Eastern Union
Founded in 2001, Eastern Union is a leading, national commercial mortgage brokerage firm. It employs more than 125 real estate professionals and closes an average of $5 billion in transactions annually. Eastern Union leverages its relationships with lenders and its marketplace knowledge to secure the best available rates and terms.
Eastern Union, headquartered in New York, closes transactions of all sizes across the United States. It secures financing for all asset types. Transactions — which can include multi-state and multi-site portfolios — encompass both conventional and structured financing. In 2020, Eastern Union’s Multi-Family Group reset market pricing by offering a quarter-point fee for refinancing properties backed by Fannie Mae or Freddie Mac. Capital introductions are handled through Eastern Union’s affiliate, Eastern Equity Advisors.
For more information, visit www.easternunion.com.
