Dealmaker: MetroGroup Realty Finance Provides $16M for Retail, Industrial

February 27, 2019

MetroGroup Realty Finance, Newport Beach, Calif., provided $15.7 million in financing for retail and industrial assets in California and Nevada.

In Moreno Valley, Calif., near San Bernardino, MetroGroup provided $8.2 million for Stoneridge Town Center, a value-add retail center. The property includes four multi-tenant retail buildings and two retail boxes totaling 117,000 square feet as well as four pads for future development. MetroGroup Realty Finance Vice President Scott Botsford arranged the financing.

Botsford said the sponsor plans to reposition the center and sought financing that would allow it to execute its business plan. “The retail landscape is undergoing a renaissance,” he said. “Investors across the U.S. are increasingly acquiring and repositioning older centers into centers to be more in-line with recent changes in consumer demand and preferences.”

Botsford noted many lenders have become more conservative in their underwriting for retail assets, especially for older centers. “While many lenders are taking a more critical look at retail properties, experienced, knowledgeable mortgage bankers know that they are also open to consider value-add retail projects with strong repositioning plans in-place that present upside potential,” he said.

MetroGroup also highlighted the increased development of new housing surrounding the asset that will add to the long-term value and traffic at the center, Botsford said.

The assets are located at 27110, 27120, 27130, 27140, 27190, and 27220 Eucalyptus Avenue in Moreno Valley.

MetroGroup also closed $7.5 million for industrial properties in San Diego and Las Vegas. In San Diego County the firm arranged a $4 million 10-year non-recourse loan at a 62 percent loan-to-value ratio. The loan included one year of interest-only payments, followed by a 30-year amortization schedule. It priced at 4.96 percent.

In Nevada MetroGroup arranged a $3.5 million interest-only non-recourse loan for a Las Vegas industrial property. The 67 percent loan-to-cost financing priced at Libor plus 400 basis points.