NEWPORT BEACH, Calif. – MetroGroup Realty Finance, a private commercial mortgage banking firm based in Newport Beach, California, recently arranged a total of nearly $58.7 million in financing on behalf of the respective owners of seven industrial properties totaling 688,661 square-feet in the Los Angeles and Orange County markets of Southern California.
The firm has experienced an influx of interest in financing for industrial properties over the past several months, as investors and owner-users are strategically taking advantage of the competitive market, as well as seeking to lock in still-record-low interest rates before hikes go into effect this year, according to J.D. Blashaw, Vice President at MetroGroup.
“Over the past two years, industrial has outperformed virtually all other real estate sectors, with demand and activity reaching record highs as 2021 came to a close,” says Blashaw. “The market continues to be highly competitive, particularly in the prime markets of Los Angeles and Orange County, which offer close proximity to the ports, major thoroughfares, and large population hubs, and where companies such as Amazon are snapping up industrial spaces in order to keep up with rising e-commerce demands.”
Blashaw adds that MetroGroup successfully utilized strong, long-term relationships established within a network of lenders to secure ideal terms and meet the specific needs of its clients.
“By effectively communicating the desirability and position of each property within their respective submarkets, we were able to demonstrate the long-term values and secure loans that best fit each borrower’s unique business plans,” explains Blashaw.
The firm arranged refinancing for seven transactions total, including the following properties:
Five-Building Industrial Park in Pomona, California
MetroGroup provided a total of $29 million in refinancing regarding a 503,156 square-foot industrial park totaling five buildings in the Los Angeles County submarket of Pomona, California.
The property is fully occupied by a variety of tenants, with uses ranging from light manufacturing, warehouse and distribution.
Blashaw explains: “The financing allowed our client to reduce the interest expense and payment on the existing debt in today’s historically low-rate environment, while tapping earned equity in the project for other investment opportunities.”
The loan featured an interest rate in the high-2% range, fixed for 10 years with interest-only debt service.
Industrial Asset in City of Industry, California
MetroGroup secured $10.2 million in refinancing for a 63,135 square-foot industrial property in the Los Angeles County submarket of City of Industry, California.
The building is currently 100% occupied by two users, with more than 50% of the space being utilized by the owner of the building.
The borrower requested cash-out refinancing to provide working capital to support its growing business recovering from the impacts of the pandemic, explains MetroGroup Vice President Ivan Kustic, who arranged the loan.
“We have worked with many owner-users who seek cash-out refinancing to help ease the impact of the pandemic and help their businesses thrive,” says Kustic. “Due to our long-standing relationships in the capital markets, we were able to provide an SBA loan after working directly with the CDC and our lender to provide cash-out refinancing at competitive pricing, despite historical cash flow not initially supporting the loan request.”
According to Kustic, MetroGroup was able to secure competitive pricing with a blended rate in the low-3% range for the projection-based loan.
The five additional financing transactions include:
- The $2.2 million refinance of a 13,175 square-foot industrial building in Anaheim, California
- The $3 million refinance of a 18,476 square-foot industrial building in Torrance, California
- The $3 million refinance of a 28,030 square-foot industrial building in Santa Ana, California
- The $4 million refinance of a 22,989 square-foot industrial building in Santa Ana, California
- The $7.3 million refinance of a 39,700 square-foot industrial building in Los Angeles, California
About MetroGroup Realty Finance
Founded in 1983, MetroGroup Realty Finance is a private, Newport Beach-based mortgage banking company that specializes in providing capital advisory and mortgage banking services for properties throughout the United States. With deep experience across a variety of property types including office, retail, industrial, multi-family, mixed-use, hotel/lodging, and land, MetroGroup has established long-term relationships with well-respected capital sources, through which the firm delivers lasting results to its clients. Additional information is available at www.metrogroupfinance.com.
