BALTIMORE—Numerous studies and surveys have shown that foreign investors are increasing their presence in the US -- and that this investment is spreading beyond the gateway cities and, when necessary, being invested in smaller chunks in order to get a piece of a good deal.

A Bridge Loan for a High-Quality Project

Such was the case with a recent financing in Baltimore. New York-based Mission Capital Advisors secured $34.3 million in bridge financing from a foreign lender to stabilize a downtown historic property in Baltimore called the Equitable Building that had recently been converted to mix use.

It was a good deal for the borrower, Mission Capital's Jonathan More told GlobeSt.com.

The owners were able to retire the existing capital structure while the property was still ramping up its occupancy, he said. "We also structured the five-year, non-recourse deal to include an earnout that will provide the sponsor with additional capital upon the property's stabilization."

As for the foreign investor the deal, obviously, was favorable as well. In this case, the term 'bridge financing' is a bit misleading, at least as it's understood to be for properties that are asomewhat risky bets for more traditional finance providers.

The Equitable Building is a 223,877-square-foot, landmarked office building redeveloped into a mixed-use property with 189 luxury residential units and 24,800 square feet of ground-floor retail, 80% of which is already leased.

The loan sponsor, a joint venture between JK Equities and SMB Bradley, purchased the it in 2013, and began a major redevelopment campaign, while maintaining the structure's historic building elements, including arched windows and period mosaic tile.

The property's residential units are already 49% leased.

Monument Realty First Baltimore Project

Monument Realty is a fixture in Washington DC's development community, but now it is branching out into Baltimore with its first project in the city – the renovation of a 1960s-era, vacant Downtown office into a mixed-use residential and retail project.

It recently secured $47.4 million in construction financing from Citizens Bank and First Niagara Bank.

It is also tapping foreign capital in the form of EB-5 financing, with Washington DC-based EB Capital providing preferred equity of $20 million.

The building, located at 225 North Calvert Street at the intersections of Lexington and Calvert Streets, will have 346 apartment units and 9,535 square feet of ground floor retail.

Monument has already begun demolition work and is scheduled to begin the renovation in March with a delivery date in the fourth quarter of 2017.

Instant Insights /

Two Deals Highlights Baltimore's Appeal to Foreign Investors

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