LOS ANGELES—To ensure a speedy transaction, the AmericanMusical and Dramatic Academy secured a short-termhard-money loan for the acquisition of its new office building inHollywood. In an earlier story, GlobeSt.com reported that AMDApurchased the 19,750-square-foot office building from Hello& Co. for $10 million. AMDA financed 50% of thepurchase with a loan funded by Lone Oak Fund.

“The Hollywood market is very hot right now,” AlexaMizrahi, a senior loan officer at Lone Oak Fund, tellsGlobeSt.com. “The buyer needed a quick close to beat out thecompetition. A successful close of escrow was imperative for thisbuyer to expand its current campus.” The loan has an 18-month termwith 8.3% interest only. Because the borrower was able to securethis type of short-term loan with 50% cash down, the transactionwas complete in less than 30 days.

An 8.3% interest rate may sound high for a bank loan, but for ashort-term interest only loan, Mizrahi explains that it isextremely competitive. “The advantages of using hard money includespeed, service, and certainty of execution. Lone Oak Fund never hasa prepayment penalty, so the borrower can pay us off with a lessexpensive bank loan as soon as interior improvements arecompleted,” she says.