RICHARDSON, TX-A long-time owner of a 517,000-sf, net-leased office complex has restructured the mortgage with a $31.9-million loan as the final stage in a four-pronged move to assume full control of the suburban property.
The Swig Co. polished off the plan, which has been in the works at least eight months, by securing a 15-year permanent mortgage on 901 S. Central Expressway, Ken Perry, chief investment officer and head of asset management for the San Francisco-based firm, tells GlobeSt.com. The closing marks the final leg of a plan to buy out its San Francisco partner, Richardson Investors LP, led by Melvin Kaplan, after more than two decades of a joint ownership in the asset. The 25-year tenant, Blue Cross/Blue Shield of Texas, signed a 16-renewal in February as part of the partnership buy-out.
Perry says the previous moves required paying off floating-rate debt, executing a 1031 exchange trade, buying out its partner and then securing the permanent financing. Swig used gain from the December 2004 sale of the Esperson buildings in Downtown Houston to finance the partnership buyout in April and then started to negotiate terms for a permanent loan that cleared all hurdles in the past two weeks, according to Perry.
Perry says Countrywide Commercial Finance Inc. of Calabasas, CA set up a fully amortized package with a ballpark 50% loan-to-value ratio and sub-5.5% fixed-rate interest. He says Swig "checked the market," but went with Countrywide because of past dealings and its familiarity with the four-story office building, single-story annex and parking garage, developed in 1971 on 20.1 acres.
Perry says the phased-in takeover is not intended to set up a sale. "Our intent right now is to hold onto it for the long term," he explains.
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