Cronheim Mortgage Secures $12,000,000 For Suburban PA Office
King of Prussia, PA – David Turley and Janet Proscia arranged a three-year fixed rate loan for $12,000,000 on a 102,204 SF office building in King of Prussia, PA. The debt was sourced from a regional bank, which funded a 65% LTV loan on a non-recourse basis.
The property is a single-story industrial building, which the borrower converted to multi-tenant office building in 2007. It features high ceilings, large open floor plates, low loss factor and easy access from an oversized parking field. The property is strategically located less than one mile from the King of Prussia Mall. At the time of closing the property was 85% leased to four tenants, none of which had a remaining lease term longer than 5 years.
Proscia noted: “Early-term lease maturities created exit issues for the borrower. This also complicated the financing picture as permanent lenders were cautious about a leveraged debt basis – $118 PSF on suburban office – on a building with no long-term leases.”
Turley added: “We found a bank willing to offer a bridge facility at a fixed conventional rate to allow borrower time to work on lease extensions as a set-up to a sale. Very liberal prepayment flexibility allows the borrower to sell or refinance as soon as the building is fully stabilized.”