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JASPER, AL-The 10-year owner of the 287,000-sf Jasper Mall has refueled its till with a $12.55-million loan. The 80% loan-to-value financing has retired some debt, allowed a cash-out and set up a $750,000 reserve for leasing commissions and tenant finish-outs.

With its anchors on five-year leases, the lenders’ circle, on average, was requiring a $750,000 reserve although Kmart and JCPenney had re-upped earlier this year, Will James, associate with CREFunding in Atlanta, tells GlobeSt.com. The advantage for the 33-acre footprint at 300 Highway 78E is that it’s the key piece of retail in the city, according to James. “And,” he adds, “nobody’s going to come in here and build another power center. It’s a unique set of demographics in a location that is geographically irreplaceable.”

The hot rumor on the street is that the owners, Jasper Retail Group LLC of Birmingham, is working a deal to put a Sears store into the 80,000-sf Kmart slot should it become available. But, for now, it’s just a market rumor. But what isn’t rumor is that CVS will be vacating a 10,000-sf outparcel location at the mall’s entrance. James says plans are afoot to add onto the building and possibly multi-tenant it.

James says the deciding factor for the owner to pursue a refinance when it did was the anchors’ decisions to exercise renewal options. JCPenney occupies 60,000 sf and the third anchor, Belk’s, fills 50,000 sf. The anchors’ leases all have five-year terms and up to four options to extend.

“It was a tough loan,” James says. “My client knows that.” Two verbal offers and a written one came in, with the deal swinging to a national insurance company conduit lender in a 75-day start-to-finish spin. James says the fresh capital was bundled with a 10-year term at a 6.4% fixed-rate interest rate with the $750,000 reserve in a non-recourse arrangement.

“It’s a class A asset in a B market,” James explains of the borrower’s ability to refinance an enclosed regional mall. Plus, the 25-year-old mall has historically high occupancy, with its space today 95% leased. “It’s truly a stabilized deal,” he says, adding that the owner’s plan remains to be a long-term hold.

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