Cash-Out Bridge Loan for Vacant Industrial Property in Hollister, California

First Bridge Lending, a direct private lender, funded a $5,000,000 1st lien position bridge loan secured by a large industrial property in Hollister, San Benito County, CA. The Borrower is an experienced investor who has been a full-time landlord for more than 25 years, and they were seeking an equity cash-out loan for business expenses and capital improvements. They purchased the property in 2008 for $12.5M, then leased it for 10 years. The tenant vacated at the end of the lease term. The property was owned free-and-clear of any mortgages, with the exception of a cross-collateral property that was to be refinanced. First Bridge Lending provided an initial funding of $3,000,000 with a first draw of $1,000,000 and subsequent draws of $250,000 each to provide refinance shortfall funds as needed. We did our own in-house valuation and did not require an appraisal. We estimated the value to be around $16,000,000 which out our loan at a very conservative 31% LTV. The loan term is 12 months. The Borrower’s exit strategy was to complete the improvements, lease to a new tenant and refinance with permanent financing. This equity cash-out loan was funded in March 2019.