Donahue Schriber Closes $1B in Deals

COSTA MESA, CA-Retail-center owner, operator and developer Donahue Schriber Realty Group has closed on $1.1 billion of strategic financing transactions in one week. The financings include a $712-million secured bank term facility and a $100-million life-insurance company mortgage.

In connection with the bank facility, the company executed a separate interest-rate hedge with a peak amount of $285 million. In total, these financings will encumber 38 of the company's 74 owned assets.

The completion of these financings strengthens the company's relationship with several financial institutions including Bank of America, Wells Fargo, US Bank, Union Bank, PNC, City National and TIAA-CREF.

According to Allen Staff, Bank of America's market president and market executive, “The term facility was one of the largest originated in the nation this year.” Donahue Schriber was advised on both transactions by Craig Zarro of Preferred Capital Advisors in Sacramento.

Patrick Donahue, Donahue Schriber's chairman and CEO, says, “Our $1.1-billion week is a significant corporate milestone that allows Donahue Schriber to reduce borrowing costs, extend the maturity dates on a bulk of our loans through 2023, while also providing future portfolio flexibility for dispositions and acquisitions. With these financings behind us, we can turn our attention from the capital markets to our core business. We are well positioned for growth in high-barrier-to-entry, supply-constrained markets on the West Coast. We are ready to take advantage of the improving economy and are investing $345 million into our development and redevelopment pipeline.”

The company will remain active with two new ground-up developments: Rocklin Crossings and Rocklin Commons, located in Rocklin, CA. The projects are progressing at a rapid pace, with a Walmart Supercenter opening within days at Rocklin Crossings, a 500,000-square-foot center located of I-80 and Sierra College Blvd. In Spring 2014, Target will open across I-80 at Rocklin Commons, a 360,000-square-foot center.

In addition to its current development and redevelopment projects, the company has also been busy on the acquisition front, acquiring $325 million in institutional-quality retail projects within the last 24 months.

As GlobeSt.com reported exclusively in September, in response to a question about whether interest rates or consumer confidence are the bigger question for retail during the remainder of the year, Dave Mossman, EVP and chief investment officer of Donahue Schriber, responded: “If interest rates remain relatively stable, our markets will follow suit. The biggest positive change from a deal-making perspective is our company is seeing an infusion of independent entrepreneurs looking for retail space in the past year. This is a welcome and positive sign for our industry; it was not like that from 2009-2012. In addition to this, savvy national retailers continue to aggressively seek new deals that will increase their market share in highly coveted, high barrier to entry trade areas.”