Trizec Clears $58.5M Debt With Dual-Pronged $92M Refinancing

Bank of America CMBS Capital Markets provided the capital for the seven-year loan at a fixed interest rate of 4.98%, according to a Trizec spokesman. Not only did the Prudential Insurance Co. note get paid off, but Trizec secured an interest rate that's 2.34% less than it had been paying. The refi closed in time to avert a Jan. 1 maturity for the Prudential loan. The new note expires Jan. 1, 2010.

The contact tells GlobeSt.com that the refi, in addition to satisfying the Prudential debt, was done to build liquidity, as Trizec openly said it would do in order to position for acquisition--deals that would come in 2004 if the market improves. "We saw an opportunity with the value of the property to take cash out," he says. The low interest rates sweetened the proposition.

John W. Rose, director for Dallas-based Holliday Fenoglio Fowler LP, arranged the loan. Bank of America CMBS used Joe Schmidt, central regional manager, to structure the terms of the transaction. Rose says it took just 61 days from the point of application to the close.

The CBD tower at 1201 Elm St. is now 89% occupied, reports Thom Ridnour, Trizec's regional vice president in Dallas. Its top tenants are Blockbuster Inc., the law firm of Winstead, Sechrest & Minick, SWS Securities Inc., Transamerica Real Estate Tax Services Inc. and the Neiman Marcus Group.

None of the cash-out capital will be deployed into major upgrades of the 28-year-old, 56-story office tower, Trizec execs say. The last renovation--$103 million--was completed in 1992.

The class A landmark, with its distinctive double X lighting pattern on the side, was designed by Hellmuth, Obata & Kassabaum. It is the city's second largest office building, a mix of office and retail space that sports the largest floor plates, 31,000 sf, to be found in the CBD. The complex also includes an adjacent 11-story, 1,091-space parking garage.