Case Study: $40MM Leased Fee Portfolio | Recapitalization | Virginia

Structured and arranged a revolving credit facility secured by a 773,000-square-foot portfolio of ground leased retail sites located in Falls Church and Fredericksburg, Virginia.

Challenges

The owner required a non-recourse, medium-term floating rate facility secured by a non-traditional asset class. Although abundantly available for large scale institutional borrowers, floating revolvers are less readily accessible in the middle-market space. Further complicating matters was the difference in value of the unencumbered land vs. the in-place leases against which underwriting would occur.         

Solutions

Identified a lender seeking to expand aggressively in the region and looking to establish new relationships with desirable clients. Negotiated a higher loan amount by framing the underwriting to be more in line with a long-term collateral asset, thereby lowering the underwritten DSCR relative to what the lender had used in the past.