Dealmaker: MetroGroup Realty Finance Arranges $11M for California Retail Center

(The Commons at Alisa Viejo.)

MetroGroup Realty Finance, Newport Beach, Calif., secured a $10.6 million bridge loan for The Commons at Alisa Viejo, a Trader Joe’s-anchored retail center in Aliso Viejo, Calif.

J.D. Blashaw, Vice President at MetroGroup, said the financing replaces a maturing commercial mortgage-backed securities loan the firm previously arranged in 2012.

“The borrower has a well-positioned retail asset that is currently undergoing a period of transition, having recently secured two leases to high-quality tenants,” Blashaw said. “We were able to secure financing that allows the sponsors to take out the maturing debt and provides capital for tenant improvements, leasing commissions and funds for planned capital improvements to modernize the center.”

Blashaw noted the 36-month term gives the sponsors time to execute an upcoming Trader Joe’s expansion and fill the remaining small vacancies to fully stabilize the asset, positioning it for a new permanent loan.

New tenants include popular restaurants that align with the borrower’s business plan of repositioning and diversifying the center to serve both daily needs and dining destinations.

“Despite capital market challenges as well as general uncertainty and a wait-and-see sentiment impacting all asset classes, many well-located retail centers with a strategic tenant mix that serve local demographics are thriving and poised for success as the market recovers,” Blashaw said. “Our team was able to demonstrate that despite the property’s vacancies at the time, the asset is set to see strong cashflow in the coming months, with renovations and a rebranding adding further value down the line.”

Orange County’s retail market tightened over the past year, and Aliso Viejo’s household income exceeds $122,000 per year.