Dealmaker: Sonnenblick-Eichner Arranges $27M for Santa Monica Retail Building

(Rendering courtesy of Sonnenblick-Eichner Co.)

Sonnenblick-Eichner Co., Beverly Hills, Calif. arranged $27.4 million in construction financing for a three-story 25,000-square-foot retail building on Third Street Promenade in Santa Monica, Calif.  

Located at 1404 – 1408 Third Street, the Class A building will provide 50 feet of high-profile retail frontage along a Southern California High Street. One of the building’s more distinctive characteristics will be a 2,500 square-foot roof deck with unobstructed views of the Santa Monica Mountains and the Los Angeles Basin. The new construction will replace a 77-year-old mixed-used building that was razed last year by developer Blatteis & Schnur.

A private debt fund originated the non-recourse construction loan, which priced at SOFR plus 550 basis points.

“Funding a speculative retail development in today’s environment is very challenging, however we were able to identify a lender who understood the unique location of this asset and the strength of the developer as well as their ability to execute on their business plan,” said Sonnenblick-Eichner Principal David Sonnenblick.

Patrick Brown, also a Principal with the firm, noted there is no shortage of capital for quality real estate projects today. “We have been successful in recently sourcing not only construction financing, but also interim and acquisition loans, as well as long-term fixed-rate loans,” he said.

The Third Street Promenade is a three-block, vehicle-free open-air retail district with more than 200,000 square feet of retail, dining and entertainment venues. The property is less than one block from Santa Monica Place, a 475,000 square-foot open-air mall anchored by Nordstrom with tenants including Tiffany & Co., Louis Vuitton and Tesla.