CBRE ARRANGES $170 MILLION IN FINANCING ON BEHALF OF THE KOLL COMPANY FOR AIRPORT BUSINESS CENTER IN
FOR IMMEDIATE RELEASE
CBRE ARRANGES $170 MILLION IN FINANCING ON BEHALF OF THE KOLL COMPANY FOR AIRPORT BUSINESS CENTER IN IRVINE, CA
Newport Beach – January 24, 2018 – CBRE Capital Markets’ Debt & Structured Finance team has arranged $170 million in financing on behalf of The Koll Company for Airport Business Center, an office/flex industrial park in Irvine, California.
Following a highly competitive bidding process involving life companies, debt funds, and securitization shops, the loan was split into a $150 million senior loan awarded to Wells Fargo, with, a real estate debt fund controlled by Brookfield, originating the $20 million mezzanine loan. The new loan has a 10-year term and carries an all-in fixed interest rate in the mid-4 percent range. This loan will refinance a loan that CBRE and The Koll Company originated in October 2014 with Brookfield and Morgan Stanley.
“The decision was made during mid-2017 to test the financing markets ahead of the 2019 maturity on the existing loan. This decision was based on several factors: The property fundamentals are very strong with occupancy at around 97 percent and rents up significantly since the 2014 closing; a belief that interest rates would be substantially higher at maturity in late 2019; and the opportunity to reduce debt service and enhance cash flow,” said Ms. Kline, executive vice president of CBRE Capital Markets.
Daniel Vagnier of Chatham Financial provided defeasance strategy advice to Koll.
“This refinancing allowed us to eliminate the near-term risk of a refinance in 2019, secure long term debt while rates are at historically low levels while reducing debt service and increasing cash flow for this legacy asset,” said Gerald Yahr, managing principal, The Koll Company.
Airport Business Center has had continuous ownership and management since The Koll Company purchased the land and initiated construction in 1969. With 68 buildings and 509 units on a 75-acre campus, the 1.2 million square foot property is one of the premier business parks in Southern California.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
About the Koll Company
The Koll Company acquires, develops and manages commercial real estate. Acting as a principal for each investment, the company focuses on the acquisition of office properties, multi-tenant light industrial business parks, improving and repositioning underutilized properties, providing ground-up development services and using its operational expertise and vision to maximize returns from performing assets. Since its founding in 1962, The Koll Company has developed more than 110 million square feet of office, industrial and retail space. Further information on the company is available at www.koll.com
Brookfield is one of the largest global investors in real estate, owning and operating an irreplaceable portfolio of iconic properties located in the world’s most dynamic markets. Their portfolio spans multiple asset classes, including office, retail, multifamily, industrial, hospitality, self-storage and student housing in North America, South America, Europe, Australia and Asia Pacific. Their long-term objective is to generate stable and growing distributions for our investors while protecting them against downside risk. Further information on the company is available at www.brookfield.com
About Wells Fargo
Wells Fargo & Company (NYSE: WFC) is a diversified, community-based financial services company with $1.9 trillion in assets. Wells Fargo’s vision is to satisfy our customers’ financial needs and help them succeed financially. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, investments, mortgage, and consumer and commercial finance through more than 8,300 locations, 13,000 ATMs, the internet (wellsfargo.com) and mobile banking, and has offices in 42 countries and territories to support customers who conduct business in the global economy. Further information on the company is available at www.wellsfargo.com
About Chatham Financial
Chatham Financial is an independent financial risk management firm specializing in solving common yet complex capital markets challenges. Chatham serves over 1,800 clients globally, providing advisory and technology solutions to Corporations, Financial Institutions, Private Equity and Real Estate companies, helping them understand and control debt and derivatives as a critical piece of their financial strategy. Further information is available at www.chathamfinancial.com