SAN FRANCISCO-A City-Core Development affiliate has refinanced 1900 Bryant St. The transaction increased loan proceeds from the mixed-use former Best Foods Mayonnaise factory while substantially lowering its interest rate.
City-Core's affiliate acquired the abandoned 148,000-sf, five-building complex in 1995 and proceeded to convert it into a mix of 14-foot-clear office, live-work and retail units. Pottery Barn's design group and UC San Francisco are the major commercial tenants. Starbucks anchors the retail portion of the property. The 22 live-work lofts are rentals. The development is currently 98% occupied.
The $26-million, 10-year fixed-rate loan was funded by an undisclosed CMBS lender and arranged by Highland Realty Capital. Highland Realty's Michael Guterman tells GlobeSt.com that the new loan defeased two CMBS loans and paid off a third bank loan while also returning some equity to investors.
All three loans carried interest rates that were substantially higher than the new loan, which carries an interest rate in the high 5% range. The loan also allows for flexibility in releasing the live-work units from the loan collateral should City-Core wish to capitalize on their for-sale value.
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