Done Deals: Dec 22, 2013

Sunday, December 22, 2013

W Financial Closes $12 Million Acquisition Loan for 12,000-SF Commercial Condo on Park Avenue on Manhattan’s Upper East Side

Park Avenue, Upper East Side, Manhattan, NY

David Heiden

NEW YORK, NY--W Financial has closed a time-sensitive acquisition loan for the $21,750,000 purchase of a well-located, nearly 12,000 square foot commercial condominium located on a prime corner of Park Avenue on Manhattan’s Upper East Side.

Although the borrower had already lined up conventional financing, and there was a new 15-year triple-net lease with a long-established medical practice in place, the bank was not yet ready to close, and a 1031 tax-free exchange deadline created the urgency to close with a bridge lender in order to preserve the favorable tax treatment for the buyer.

It is expected that the bridge loan will be refinanced upon the closing of the conventional financing.

W will also consider providing construction loans in Manhattan or Brooklyn for experienced developers, as well as mezzanine loans, preferred equity or joint venture equity on well-located, cash-flowing properties.

Manhattan Upper East Side

On select transactions W Financial is pricing its bridge loans as low as 8%, with terms as long as five years depending on the usual factors such as location, loan-to-value ratio, cash flow and quality of the sponsorship.

Click here to see recent bridge loans closed by W, and read our home page to get a better sense of which of your prospective loan scenarios might be in our "strike zone".

Call me to discuss or contact my partner David Heiden | david@w-financial.com (212) 684-8484, or contact our Senior Loan Officer Jarret Schochet | jarret@w-financial.com (212) 684-2205 to discuss your new bridge loan scenarios.

For a complete copy of the company’s news release, please contact:

Gregg Winter - President

Winter & Company

Creative Minds | Unparalleled Service ®

149 Madison Avenue, Seventh floor

New York, NY 10016

Phone: 212 532-1122 x1

Email: gregg@winterandcompany.com

http://www.winterandcompany.com

21-story, 150-unit luxury cooperative building on East End Avenue
on Upper Side of Manhattan, NY

NEW YORK, NY -- Winter & Company was retained by the board of directors to advise and structure a new $20,000,000 underlying mortgage and revolving credit facility for this 21-story, 150-unit, full-service luxury cooperative building with a rooftop pool, full gym, garden and garage located on East End Avenue on the Upper East Side of Manhattan.

Gregg Winter

The borrower's main focus was on obtaining a new, 10-year, fixed-rate, interest-only mortgage with a 3.25% interest rate to replace their old 6.12% mortgage.

In addition, the borrower also required a $2,000,000 unsecured line of credit to provide flexibility to address unforeseen future capital improvements and repairs.

The unsecured, revolving credit facility saved the borrower $56,000 ($2,000,000 x 2.8%) in NYC mortgage recording tax (compared to a secured facility like a credit line mortgage).

The co-op board reached a consensus quickly and moved decisively in order to lock in a forward commitment for this exceptional rate in a rising interest rate environment.

As is often the case, Winter & Company seeks to customize the loan structure to meet the specific needs of each client. In this co-op's case, two other special attributes of this financing are worth highlighting:

Forward Rate Lock:

The co-op's old mortgage had a large yield maintenance prepayment penalty. For them, a strategy of locking in a new, low rate for their new underlying mortgage but delaying the closing by six months would save the co-op a considerable amount of money on the cost of the pre-payment penalty on their old mortgage.

This is the approach that was taken, with rate lock occurring in May and the closing delayed until November.

Accelerated principal paydown option:

This cooperative also wanted to have the ability, should it decide to do so, of being able to utilize surplus cash flow to pay down up to 10% of their remaining principal balance per year without triggering a prepayment penalty.

In the event of such principal reduction, the payments would also be adjusted accordingly going forward. Although this is a highly unusual and non-standard feature in the commercial mortgage marketplace, we were able to successfully structure this option for our client.

The many post-war, white brick, 60's-era buildings all over Manhattan's East Side are notoriously expensive to maintain.

This co-op wisely chose to take full advantage of the availability of very cheap capital, thus the co-op emerged from the recent refinancing with more than $6,000,000 of surplus cash which they can deploy to address a long list of future capital improvements and repairs, not to mention the $2,000,000 unsecured line of credit which will stand at the ready to provide for future contingencies.

Winter & Company is a Manhattan-based, commercial mortgage advisory firm that specializes in arranging development and construction financing, multifamily and mixed-use property financing and arranging cooperative underlying mortgages since 1989.

Its affiliate, W Financial Fund, LP is a direct private bridge lender providing short-term, special situation financing primarily for NYC multifamily and mixed-use properties celebrating its 10th year of successful operations.

W Financial was recently profiled in Barron’s. The article. “Rock-Solid Real Estate” is available here.