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CLEAR LAKE, TX-A newly signed 10-year lease and the prevailing low interest rates have precipitated a $1.5-million refinancing. The deal not only rolls in new terms for outstanding debt, but also gathers capital for agreed-to property improvements at the single-tenant building.

The 1300-A Bay Area Blvd., about 25 miles southeast of Houston’s CBD, is standing as collateral for the Ohio National Life Insurance Co. loan. The 34,873-sf, two-story office building is owned by a Texas joint venture, 1300 Bay Area Venture. The fixed-rate loan carries a 10-year term.

Jeff Knowles, associate director for Dallas-based Holliday Fenoglio Fowler LP’s Houston office, arranged the financing. He tells GlobeSt.com that the owner, who purchased the building in the early 1990s, pushed the refinance because of market conditions and the freshly signed lease by United Way of the Texas Gulf Coast.

Knowles says United Way has been the only tenant in the building since the early 1990s. It recently signed a 10-year renewal that called for substantial renovations, including a new HVAC system, roof and parking lot, as well as upgrades to the interior design and electrical system. The loan enabled the owner to finance the improvements.

“This property presented a challenge in that single-tenant properties can often be difficult to finance,” Knowles said in a prepared statement. “In this particular instance, the tenant has a long history in the building and recently committed to a new long-term lease, making the deal much more appealing to investors.”

The building, constructed in 1968, is located at the corner of Bay Area Boulevard and Saturn Lane. It is one of 87 office buildings in the 5.8-million-sf submarket.

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