Dealmaker: Mesa West Capital Lends $80M in California

Mesa West Capital, Los Angeles, originated $63.8 million in short-term first mortgage debt in separate financings secured by assets in Walnut Creek, Calif. and San Diego.

Mesa West provided a Citivest Commercial and Tallen Capital Partners joint venture with $35.75 million to refinance and reposition the Rossmoor Shopping Center in Walnut Creek. The sponsor acquired the property in 2012 and plans redevelopment that will include upgrading the exterior façade, expanding the inline space and adding new retail pads. The improvements will create 27,000 square feet of net rentable area to the existing 108,000-square-foot grocery-anchored retail center.

Citivest Commercial and Tallen plan to leverage the planned improvements to roll existing leases to market. Starbucks and CVS recently agreed to lease the future pad space.

In another financing, Mesa West provided Newport National Corp. with $28 million to acquire, renovate and stabilize Scripps Summit Court in San Diego.

Newport National Corp. recently acquired the asset from owner-user HD Supply Facilities Maintenance, which recently relocated to Atlanta. The asset includes a vacant four-story, 146,500-square-foot commercial office building on 21 acres in the Scripps Ranch submarket.

Loan proceeds will complete a renovation that includes a new exterior entrance and upgrades to the lobby and common areas. The loan includes a holdback to fund future tenant improvements and leasing costs.

Each property received a five-year nonrecourse floating-rate loan, said Mesa West Principal Steve Fried, who originated the financing with Associate Seth Hall.

Mesa West also lent the Vanbarton Group and its pension fund partner $16 million to finance a fully occupied 12,000-square-foot retail property in San Francisco.

Located one block south of Union Square at 39 Stockton Street, the two-story building is fully leased to The Walt Disney Co.

A new Central Subway station is under construction nearby at Stockton and Market streets. When completed in 2019, the Central Subway station should increase pedestrian traffic on Stockton Street, said Mesa West Principal Ronnie Gul, who led the origination team.

“The Union Square submarket is already one of the most desirable retail districts in the United States and occupancy and rental rates are at historic levels,” Gul said. “The new subway will bring thousands of locals and tourists each day right to the front step of the asset, which will substantially increase the desirability of the property.”