NEW YORK CITY—KTR Capital Partners has secured a $142 million loan for a 4.3 million-square-foot portfolio of industrial properties located in Georgia, Nevada and Texas. Arranged by CBRE’s Val Achtemeier, EVP and provided by Prudential Mortgage Capital Corp., the senior loan features a 65% fixed rate portion of $92.3 million and 35% floating rate portion of $49.7 million.
The loan—provided to KTR affiliate KTR Industrial Fund III—features blended pricing with a five-year term as well as full-term interest only. The newly financed industrial portfolio consists of 16 institutional quality buildings across Georgia, Texas and Nevada. The portfolio is 87% leased and represents a critical mass of industrial warehouse and distribution facilities that CBRE describes as “highly functional.” The portfolio provides geographic and tenant diversification, functional layouts, strong dynamics and a manageable lease maturity schedule, according to the services firm.
“The KTR industrial portfolio loan was a ‘win-win’ for both KTR and Prudential,” says Achtemeier. “The fixed/floating combination with the full interest-only structure provided the borrower desired flexibility and a very attractive blended interest rate, while Prudential was able to expand its industrial exposure through a large loan with scale, excellent sponsorship, diversification and solid economic metrics.”
Adds Achtemeier, in speaking with GlobeSt.com about the blended pricing, “Given the compression in spreads in early 2014 and the use of a combination of floating and fixed rate debt , the initial “all-in” rate is well below 2.75% interest rate.”