Dealmaker: Berkadia Secures $70M for San Francisco Office Building

Berkadia, New York, arranged $70 million for the Mills Building, a 440,000-square-foot San Francisco office property.

Berkadia Senior Managing Director Mitch Thurston and Senior Director Andy Ahlers secured the 10-year loan through Voya Investment Management, New York, on behalf of The Swig Co., San Francisco.

The full-term fixed-rate loan included interest-only payments and refinanced existing debt on the property.

“The Mills Building, a strategic long-term investment and also The Swig Co.’s headquarters location, required a lender willing to offer management and operational flexibility,” said The Swig Co. CEO Ken Perry. He noted that Berkadia found numerous life company candidates and said Voya Investment Management provided the flexibility and terms that met Swig’s needs.

In addition to The Swig Co., tenants such as the New York Stock Exchange and the University of California-San Francisco occupy 95 percent of the building.

Berkadia also represented seller Bellagio Owner LLC when it sold Bellagio Apartments in Scottsdale, Ariz. for $36.25 million, or $179,455 per unit. Saltzman Properties, Portland, Ore., purchased the 202-unit property. Berkadia Senior Managing Director Mark Forrester, Managing Director Ric Holway, Vice President Dan Cheyne and Associate Tom Wolff facilitated the sale.

Bellagio Owner LLC owned the property for more than three years and partially upgraded the interior units and public areas. Saltzman Properties plans to complete property renovations including remaining rental units. 

Forrester said Scottsdale offers strong real estate value-add opportunities. “This sale demonstrates the robust activity we are seeing throughout the market,” he said.

Phoenix-area multifamily vacancies fell to 5.6 percent in fourth-quarter 2015. Asking rents advanced 6.2 percent year-over-year to $914 per month. Top employers in the area include Honor Health, Mayo Clinic, Verifone and The Vanguard Group.