"The play here is, this is next to the Central Artery," says Michael Prakken of national real estate investment banking firm L.J. Melody & Co.'s Boston office, who arranged the financing.
The conversion of the historical building precedes the creation of a new city park. The "green space" is expected to be finished in 2005 and is being created as a result of the city's "Big Dig" project.
First-floor retail space will to remain, with 34 units on the six floors above likely to be priced in the $450,000 range, Prakken tells GlobeSt.com.
During the next two years, though, the building's main occupant will be Modern Construction Enterprises, which is the contractor on the "Big Dig." The refinancing will pay for architectural and permitting needed for the conversion. Although an additional two stories is envisioned, the owner still needs to go through the permitting process, Prakken says.
Banknorth Massachusetts is providing a $5.85-million interest-only first mortgage for 18 months at LIBOR plus 275 points, Prakken reports. Realty Financial Partners is providing a combination of $4.13 million in mezzanine and preferred equity financing.
The package takes out a bridge loan used to acquire the property in a sale-leaseback with Modern Construction Enterprises, says Prakken, who likely has one more deal to do with 99-105 Broad Street LLC. Once Modern Construction Enterprises moves on, another refinancing will be needed to complete the $16-million project, Prakken says, or Banknorth Massachusetts may increase its first mortgage to $10 million.
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