Dealmaker: Calmwater Capital Closes $31M in Retail, Hotel Conversion Deals

Calmwater Capital, Los Angeles, provided $19.8 million for 723 EHD LLC to acquire and lease-up Shamrock Center, a 98,000-square-foot Monrovia, Calif., retail center.

The credit facility included a $9 million senior term loan for property acquisition and $10.8 million in additional potential funding for future leasing and tenant improvements.

Calmwater Capital Vice President Bradley Ross said the one-story neighborhood retail center recently lost its anchor tenant, a 70,000-square-foot Albertson’s grocery store. The center had 90 percent vacancy at closing.

“Although the center was nearly vacant at the time of close, we were confident in 723 EHD LLC’s business plan and ability to execute,” Ross said. “They have strong relationships with reputable national tenants and we knew they were the right buyers to stabilize this property.”

Located 20 miles northeast of Los Angeles, the property sits within a strong retail corridor in the San Gabriel Mountains, giving it broad appeal for both national and regional tenants, Ross said. 723 EHD LLC has secured letters of intent from several tenants including grocery, fitness, home décor and beverage retailers. The center will maintain its long-standing national tenant, O’Reilly Auto Parts.

“With nearly 100,000 square feet of unleased space and ample parking in a desirable, high-occupancy neighborhood, this property is a rarity for greater Los Angeles,” said Calmwater Capital Co-founder Larry Grantham. 

In Chicago, Calmwater Capital structured an $11.1 million loan to RCP Hotel Owner LLC, a Prime Group entity, to refinance an existing loan for 208 South LaSalle Street.

Calmwater Capital Vice President Ryan Malatesta originated the transaction. He said Prime Group will convert the Central/West Loop office property’s top five floors into hotel space.

Chicago’s central business district’s hospitality industry ranks among the top-performing markets nationally, Malatesta said: “Demand for hotels is on the rise as demand for office space in the Central and West Loop submarkets has increased with multiple businesses moving their operations into the area.”

The firm, formerly named Karlin Real Estate Lending, re-launched as Calmwater Capital in May 2015 and originated more than $400 million last year.