SCOTTSDALE, AZ-Making its first move on the metro, a development partnership has obtained $21 million in financing to acquire and construct a 103,000-sf building with warehouse and showroom space on 7.65 acres. The land, positioned in the fast-developing Scottsdale Airpark area, cost $9.5 million.
David Sotolov, vice president and loan originator for Fremont Investment & Loan LLC's Phoenix office, says the remainder of the capital will be used to build and lease up the development, dubbed the Showrooms on Hayden. In the next month, Resco Development Co. from Orange County, CA and RMB Properties, headquartered in Johannesburg will raze a 74,250-sf structure on the Hayden Road land to make room for the single-story building, slated to deliver nine months after ground breaks.
"This is the first time these two have teamed up to buy property here," Sotolov tells GlobeSt.com. "They don't have anything more that's imminent, but I think they're looking for more opportunities."
Sotolov says the Fremont-funded loan is a three-year bridge loan with a three-year mini-perm loan attached. Both loans are floating rate interest, about 300 points above Libor. The loan-to-value ratio falls between 75% and 80%. The mini-perm loan has a 30-year amortization. Tim Storey with Newmark Realty Capital in Phoenix arranged the loan. Tom Boyle with Phoenix-based Lee & Associates Arizona represented the partnership in the land acquisition as well as the seller, Stoughton Plaza LLC of Wellesley, MA.
Boyle will prelease the development, which will be laid out for six to 12 tenants, needing 10,000 sf to 20,000 sf. The target market is furniture and home improvement tenants.
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