3650 REIT Originates $276 Million in 10-Year, Fixed-Rate Loans in Q319
3650 REIT ("3650"), a balance-sheet lender focused on creating long-term relationships by originating, servicing and asset managing long- and short-term fixed-rate commercial real estate loans through maturity, funded a total of approximately $276 million in 10-year, fixed-rate loans in the third quarter of 2019. In addition to the previously announced $90 million loan to refinance the Renaissance Plano hotel in Plano, TX, the largest of the recent originations include: $66 million to sponsor Keystone Property Group for the APX Morristown office complex in Morristown, New Jersey; $27 million to sponsor Audubon Communities for the multi-property Westpark Club apartment complex in Athens, Georgia; and over $24 million to sponsor Hendon Properties LLC for The Forum at Grandview, a multi-tenant retail property located in Madison, Mississippi.
"As 3650's differentiated business model has gained more traction and our year-to-date momentum has accelerated, our activity in the third quarter has contributed significantly to our 2019 origination goal of $1.5 billion," said 3650 REIT Co-Founder and Managing Partner Toby Cobb. "As more borrowers realize the value of aligning their perspectives with a lender that does not pass ownership of its loans to a third party, our transactions continue to reflect 3650's strategy of working with exceptional sponsorship and utilizing our real estate expertise to provide inherent value to the sponsor."
APX Morristown is a Class A, five-story office complex strategically located at 412 Mount Kemble Avenue near Morristown, New Jersey's downtown district, which features an abundance of dining, shopping, entertainment and nightlife options. APX Morristown tenants enjoy easy access to New York's Pennsylvania Station via the Morristown train station, which is just two miles from the property, as well as close proximity to Newark International Airport. The building underwent extensive renovations from 2015 to 2018, consisting of an updated atrium, canopy, parking zone, restrooms, elevators, and mechanical components. Notable tenants with national headquarters at the property include Berkley Surety Group, General Insurance Company, Lonza America, Louis Berger Group Inc., New York Marine and P3 Communications Inc. The affluent Morristown submarket has remained strong in recent years, experiencing Class A office rent growth, which is expected to continue, and a significant decrease in vacancy rate. Experienced sponsor Keystone Property Group, which has worked with 3650 on previous transactions, owns eight million square feet of commercial real estate and chose 3650 for its flexible, creative loan structuring and certainty of execution. The loan will provide the borrower with its desired long-term, fixed-rate refinancing.
Located at 150 Westpark Drive in Athens, Georgia, the Westpark Club consists of 244 garden-style apartment units across 12 buildings. The complex's attractive location, less than a mile from the intersection of Route 78 and Route 10, is near both downtown Athens and the University of Georgia campus, providing residents with shopping selections such as the Georgia Square Mall and other major retailers. The highly amenitized rental complex offers a pool pavilion, sundeck, volleyball court, dog park, clubhouse and two tennis courts. The majority of Westpark Club's units were either built in 2018 or renovated within the last few years, and new and refreshed units feature 12-foot ceilings, oversized patio doors, and modern exteriors. The complex enjoys an excellent occupancy rate in a high-growth Athens rental market, and is maintained by solid management and ownership. Sponsor Audobon Communities, which acquired the property in 2015, owns more than 7,000 apartment units in the Southeast U.S. and has already created substantial value at the Westpark Club. It sought a long-term refinancing solution, which 3650 effectively and efficiently delivered.
The Forum at Grandview is a 216,000-square-foot retail center located at Exit 108 at State Highway 463 and Grandview Boulevard in Madison, Mississippi. It is anchored by several major tenants, including Best Buy, Dick's Sporting Goods, HomeGoods, the Malco Grandview Theater, Michaels, Miskelly Furniture and Stein Mart. The extremely visible location along I-55 is ideal for retail and dining tenants, and is just a 10-minute drive from Mississippi's capital, Jackson. Madison has experienced noteworthy population growth since 2014, and has seen an increase in its average household income, making the burgeoning city ripe for investment and continued development activity. As sponsor Hendon Properties LLC sought surety of execution in the midst of its acquisition of the property, 3650 offered attractive, long-term, non-recourse permanent financing to accomplish this without the risk of the loan ever being sold to a third party. Additionally, 3650 enabled a flexible financing solution for the borrower to develop future outparcel projects.
About 3650 REIT
3650 ("Thirty-Six Fifty") REIT is a balance-sheet lender focused on creating long-term relationships by originating, servicing and asset managing long- and short-term fixed-rate commercial real estate loans through maturity. 3650 REIT's highly differentiated lending process, national scale and vertically integrated platform enable it to deliver tailored financing solutions, high-touch service and reliable, customer-focused outcomes. Co-Founders and Managing Partners Toby Cobb, Justin Kennedy and Jonathan Roth have played leading roles in the evolution of the CRE debt markets with track records of success across CRE lending, mortgage banking, capital markets, loan servicing and distressed credit management. Headquartered in Miami, Florida with offices in New York, Chicago, Dallas, Nashville and Los Angeles, 3650 REIT is well positioned to lend on properties located throughout the country. For more information, visit: www.3650REIT.com.
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