Ramco-Gershenson Properties Trust closed a $360 million unsecured credit facility, including a $240 million revolving line of credit and a $120 million term loan. The revolving line of credit is for a four-year term and carries a one-year extension option, while the term loan is for five years. The credit facility amends and restates Ramco-Gershenson’s prior $250 million facility. It can be upsized to $450 million through an accordion feature. The new facility features an interest rate at LIBOR plus 165 basis points subject to a pricing grid for changes in the company’s leverage ratio.
“The extension and expansion of our credit facility, as well as the improved pricing, demonstrates the confidence our bank group has in our business plan and our ongoing commitment to maintaining a strong, flexible balance sheet,” said Dennis Gershenson, President and CEO of Ramco-Gershenson Properties Trust, in a statement. “By taking advantage of the current bank financing environment we further our objectives of reducing the company’s overall cost of capital and moving closer to an investment grade profile.”
KeyBanc Capital Markets acted as the sole lead manager and arranger for the facility. JPMorgan Chase Bank N.A. and Bank of America N.A. served as co-syndication agents. Deutsche Bank Securities Inc. and PNC Bank were co-documentation agents. Other lenders participating in the facility included RBS Citizens N.A., Capital One N.A., The Huntington National Bank, Comerica Bank and Branch Banking and Trust Co.
SL Green Secures Loans, Sells Partial Stake in 717 Fifth Ave. Retail Condo to Partner
SL Green Realty Corp. sold 50 percent of its interest in 717 Fifth Ave. in New York City to its joint venture partner Jeff Sutton. The REIT retains a 10.92 percent stake in the retail condominium property at a price that values the asset at $618 million, or $5,015 per sq. ft., and reflects a 4.9 percent capitalization rate on in-place net operating income.
In addition, the partners secured $590 million in new financing, including a $300 million fixed-rate mortgage and a $290 million mezzanine loan. New York Life and TIAA originated the 10-year mortgage. RREEF originated the mezzanine loan, which carries a 12-year term.
SL Green received $85 million in net cash proceeds from the transactions. It acquired its interest in the property in 2006 at a price that valued the asset at $230 million. In 2011, it executed long-term leases with Dolce & Gabanna and Escada for the space.
“Our joint venture investment with Jeff Sutton at 717 Fifth Avenue has been a resounding success, as evidenced by the realization of net operating income through creative repositioning and leasing over the past six years,” said SL Green President Andrew Mathias in a statement. “The result is a sizeable gain in asset value, as recognized by our lenders, as well as our ability to monetize a portion of our position and generate substantial cash proceeds.”
Continental Realty Forms New Acquisition Fund
Continental Realty Corp. formed CRC Fund III L.P. and closed approximately $78.6 million in private equity funds provided by a mix of high net worth individuals, investment advisors, institutions, foundations and endowments. The Fund will focus on buying value-add retail and multifamily properties and notes on properties located in the Mid-Atlantic and Southeast.
The Fund has already acquired The Shops at Verandah, a 73,000-sq.-ft. neighborhood shopping center in Fort Myers, Fla. and a 30,500-sq.-ft. shopping center in Royal Palm Beach, Fla. The Shops at Verandah is 91 percent leased. It was completed in 2005 and features Publix Super Market as an anchor. The center in Royal Palm Beach is 100 percent leased to Office Depot and Mattress Firm. The Fund also purchased an apartment community in Alexandria, Va.
HFF Helps Refinance Bayfair Center in California With $50M Loan
HFF secured a $50 million refinancing for Bayfair Center, an 813,307-sq.-ft. retail center in San Leandro, Calif. on behalf of Madison Marquette Retail Enhancement Fund. Guggenheim Commercial Real Estate Finance funded the loan, which features an adjustable interest rate and a five-year term.
Bayfair Center is currently 97 percent leased, to tenants including Macy’s, Target, Kohl’s, Staples, Old Navy, PetSmart, Bed Bath & Beyond, 24 Hour Fitness and Cinemark Century 16 Theater. The property underwent a renovation in 2008.
Mark Remington and Bruce Ganong, of HFF, negotiated this transaction.
In a separate transaction negotiated by HFF, SUSO 1 ERROl LP, a fund indirectly managed by Slate Properties, bought Errol Plaza, a 71,490-sq.-ft. grocery-anchored shopping center in Apopka, Fla., from Kimco Realty Corp. for $6.125 million. The center is 96.5 percent occupied. Winn-Dixie anchors the property. Brad Peterson, Danny Finkle and Michael Weinberg, of HFF, represented the seller in the transaction.
Other Notable Deals
Faris Lee Investments negotiated sales of three triple net leased outparcels in Temecula, Calif. for a total of approximately $15 million. All three properties are located adjacent to Promenade Temecula, a 1.14-million-sq.-ft. regional mall. The outparcels included a 15,490-sq.-ft. property occupied by Panda Express, SmileCare and Sleet Train Mattress, a 9,420-sq.-ft. property occupied by Men’s Wearhouse and Qdoba Mexican Grill and a 6,750-sq.-ft. property occupied by Spring PCS, Baja Fresh and Coldstone Creamery. Jeff Conover, of Faris Lee Investments, negotiated these transactions.
O&S Holdings sold a 15,250-sq.-ft. strip center in Palmdale, Calif. to a Los Angeles-based family trust for $5.95 million. The transaction closed at a cap rate of 8.5 percent. Chris Maling and David Maling, of Colliers International, represented the seller in the transaction. Russ Chen, of Charles Dunn, represented the buyer.
Houlihan-Parnes Realtors LLC and Q10 New York Realty Advisors LLC placed a $2.5 million first mortgage on a 16,000-sq.-ft. retail property in Brooklyn, N.Y. The non-recourse loan features a fixed 4.08 percent interest rate, a seven-year term and a 30-year amortization schedule. It is pre-payable with a swap breakage feature.
Vanir Group of Cos. bought Lincoln Gateway, a 74,586-sq.-ft. mixed-use property in Sacramento, Calif., from Panattoni Development Co. The newly-constructed center includes 32,757 sq. ft. of retail space and 41,829 sq. ft. of office space. Auto Zone, Massage Envy and Little Caesars occupy the property. Robb Osborne, of Voit Real Estate Services, represented the buyer in the transaction. Gary Gallelli and Mickey Turpen represented the seller.