HARRISBURG, PA-Sage Real Estate Group has obtained a $27.2-million mortgage on Market Square Plaza, which it acquired for $32.5-million from a development partnership between locally based Pascotti Realty and the Flynn Group when the property reached completion at the end of 2005. The 84% loan-to-cost funding carries a 10-year term to amortize over 30 years following a four-year, interest-only period, according to David Turley, of Chatham, NJ-based David Cronheim Mortgage Corp. Cronheim Mortgage arranged the financing and also represented the seller in the transaction with Sage.

The new owner is an affiliate of West Conshohocken-based Sage Financial, and the acquisition was made on behalf of its Sage Real Estate Investment Fund III. The 18-story, 240,000-sf landmark at 17 N. Second St. is now called Sage Market Square Plaza. It connects via several enclosed corridors to the Hilton Harrisburg & Towers Hotel, which leases the building's second floor as conference and banquet space. The office building also connects with Whitaker Center for Science and the Arts, Walnut Place office tower and Strawberry Square, a 1.4-million-sf office/retail complex overlooking the Capitol.

The Market Square property contains ground-floor retail and an eight-story parking garage on floors three through 10 with office floors above. The retail tenants include a bank, restaurant and copy center. Among the office tenants are the Secret Service and the Pennsylvania State Department of Banking. It was more than 70% preleased before it was completed, and is now more than 90% leased. Locally based NAI/CIR handles leasing.