Life Co. Backs Major Retail Center Refi

Plaza 183 was renovated in 2014 and 2015.

LOS ANGELES—An institutional investor operating as Cerritos Retail CenterCal LLC has secured $66 million to refinance Plaza 183, a destination retail center in Cerritos. The 360,875-square-foot retail property was renovated in 2014 and 2015, and the loan proceeds will be used to refinance the acquisition and renovation financing. While the retail market has come under question , there is still lender demand for deals like this, with core properties and institutional ownership. “We continue to see strong demand from lenders for core deals with institutional sponsorship such as Plaza 183,” Steven Paskover of HFF ‘s debt placement team tells GlobeSt.com. “However, deals that have some challenges are becoming increasingly more difficult to finance and non-recourse construction financing in particular has become very difficult to place.” Paskover secured the funds on behalf of the borrower, along with HFF’s Paul Brindley and Eric Tupler . This deal received substantial interest from lenders, and in the end, Principal Life Insurance Company funded the loan. “We received robust interest in the financing from a multitude of lenders. Lender interest was driven by the aforementioned reasons as well as the fact that sponsorship had invested a significant amount of capital renovating and upgrading the property as well as the fact that a significant amount of new leasing had recently been completed at the property, providing minimal near-term rollover,” adds Paskover. “A number of lenders are currently limiting retail financing to properties anchored by grocers, however, we managed to make a strong market for the property and attained an extremely attractive offer from the lender.” The loan has a 10-year fixed rate; however, the pricing was not disclosed. Paskover adds, “The final structure was an ideal fit for the borrower as we were able to provide an extremely low coupon, long-term, fixed-rate loan with full-term interest only payments and minimal loan structure. A life company was a natural fit considering the class-A nature of the property, outstanding sponsorship and low leverage request.” Plaza 183 is an 11-building power center in Cerritos with 97% occupancy. It has a strong mix of credit tenants— Burlington Coat Factory , Buffalo Wild Wings and Nordstrom Rack , to names a few. It is located between Downtown Los Angeles and Orange County, and sees 244,000 vehicles pass by each day.