George Smith Partners Arranges $19.7 Million Loan for Retail Center in Northern California

Commercial real estate investment banking firm George Smith Partners has arranged a $19.7 million loan for Doerken Properties Inc. to refinance the Citrus Marketplace in upscale Walnut Creek, Calif.

Citrus Marketplace is a 101,000 sq. ft. grocery-anchored retail center. Tenants include Nob Hill Foods, BevMo!, Bank of America, The United States Post Office, Panda Express and Carl’s Jr.

The 10-year, CMBS loan carries a 5.69% interest rate and a 30-year amortization. The financing was 70% loan-to-value. Prepayment was based on yield maintenance at no additional cost. In addition, the loan was structured with minimal reserves.

Nob Hill Foods, a regional grocer, serves as the anchor of the center that historically has been more than 96% occupied, making it an ideal candidate for debt financing through the CMBS market, says Gary Mozer, a principal and managing director of George Smith Partners.

Still, the deal was not without challenges. “The structure included a significant cash-out for the borrower, and recent sales for the grocer were flat,” explains Mozer. “George Smith Partners and Doerken reassured the lender with in-depth market research, detailed analysis of the anchor’s year-over-year sales, strong performance history for the overall property through the recent market downturn, and Doerken’s operating expertise.”

Assisting Mozer in the transaction were Steve Orchard, Josh Roseman and Michelle Lee of George Smith Partners.

Doerken Properties focuses on the acquisition, renovation, management and development of shopping centers ranging from 70,000 sq. ft. to 350,000 sq. ft. The company’s current portfolio includes more than 2.1 million sq. ft., 40% of which is in Northern California. Doerken has managed its own properties for more than 30 years.

Founded in 1992 in Los Angeles, George Smith Partners specializes in arranging financing for commercial and residential properties, including acquisition, construction, bridge and permanent loans. The firm also arranges mezzanine loans, highly leveraged participating loans and joint venture equity.


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