Former Factory Gets $17M Acquisition/Rehab Loan

(Read more on the debt and equity markets.)

WORCESTER, MA-Capmark Finance Inc. has secured $16.9 million in financing to facilitate the purchase and repositioning of the Worcester Business Center. The former global headquarters of Thom McAn shoes was sold to a partnership that includes Suffolk Ventures and Weiner Ventures, a pair of Boston companies active in Massachusetts commercial real estate.

“The community will benefit from the renovation of a prominent office/industrial building into office space of a higher quality,” says Capmark SVP Claudia Piper, who originated the loan package. Lower-cost financing was provided via new market tax credits, she explains, while a portion of the monies will be used to make capital investments into the six-story, 285,000-sf property. The purchase price for the building and 13-acre site was $10.5 million.

Thom McAn departed from the property at 67 Millbrook St. in the mid-1990s after being acquired by a competitor. A Concord company, Worcester Millbrook LLC, paid $1.2 million for the asset in 1999 and recast the hulking structure as the Worcester Business Center, managing to attract a substantial number of tenants in the subsequent years. The attributes as an office destination are a location at the confluence of Interstates 190 and 290 and a solid physical countenance, Piper says. The building was constructed in 1920.

Worcester Millbrook did make several investments into the building during its stewardship, among them a sprinkler system, modern security network, carpeted floors, new roof and compliance to the Americans With Disabilities Act codes. The additional capital improvements planned by the new ownership include a new facade and conversion of remaining warehouse space into first-class office. Other investors in the joint venture are Franklin Realty Advisors and Concord-based Gillespie & Co., whose principal, Ian Gillespie, has successfully repositioned similar buildings, most notably 300 Baker Ave. in Concord during the 1990s.

Suffolk Ventures is led by John Fish, the president of nationally known Suffolk Construction Co., while Adam Weiner is the president of Weiner Ventures. That firm is headquartered in Boston’s Back Bay.