Deal Details
Private Loan Type
Purchase
Approx. Funding Date
08/28/2020
Property Type
Property City
Cleveland
Property State
OH
Loan Term (months)
12
Lien Type
1st Mortgage
Payment Type
Interest Only
Loan-to-Purchase Price
65%
Borrower's Contribution to Purchase
35%
Source of Borrower's Contribution
Cash
Property Neighborhood
Downtown
Occupancy at Closing
Partially Occupied
Number of Units
436
Exit Strategy
Construction Loan
Deal Summary
In August 2020, BridgeCore Capital closed an $8MM bridge loan for the acquisition of an office building in Downtown Cleveland, Ohio. The building occupancy was 42%, and the plans to convert the building into a 436-unit, Class A multifamily apartment property, with a complementary mix of office and retail. They raised some equity capital and brought 35% cash to the closing. BridgeCore’s 12-month term, including two six-month extension options, with a fully funded reserve, is providing the Borrower the necessary time to complete the pre-development plan and position the property for an exit with construction financing. BridgeCore’s competitively structured loan terms allowed the Borrower to execute the purchase of a transitional office asset at a time when conventional financing is not readily available because of the COVID-19 economic environment. Loan terms include a fully funded reserve for interest, real estate taxes, and insurance; a pay rate and accrual to lower the amount of the interest reserve; and limited recourse to $2 million, subject to standard carve-out and debt service guarantees. Although most of our bridge loans are non-recourse, this deal had an added layer of risk with the Sponsor’s ownership structure.