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Will Nelson joined Columbia Pacific Advisors in 2015 and
specializes in business-development and loan-structuring
strategies. He has participated in the acquisition, disposition, leasing, project management, entitlement work and
property management of approximately 1.5 million square
feet of real estate assets in the U.S. and Canada. Columbia
Pacific Advisors is a Seattle-based investment company
founded by Dan Baty, Stan Baty and Alex Washburn. It has
completed more than $10 billion in transactions. Reach
Nelson at (206) 576-0769 or email@example.com.
Can Get the Deal Done
When a loan transaction gets complicated, bridge lenders may offer a path forward
By Will Nelson
With the appropriate bridge loan, the new sponsor
was able to set aside reserves to provide for tenant
improvements and leasing commissions in order to
capitalize on potential expansions. The sponsor is
in positive negotiations with tenants. Currently, the
complex is 76. 4 percent occupied.
The Atlanta property deals illustrate an alternative-
investment strategy that might scare off many
conventional lenders. They simply would not be
comfortable with the projects’ level of diversity, unusual
Often, some of the best opportunities in real estate investmentdo not fit into the box of “acceptable” for many conven- tional lenders. These lenders typically
prefer to follow well-worn checklists when contemplating
a deal and may balk at the first signs of complexity.
When the path to adding value to an asset requires
creativity and a thorough understanding of the unique
traits of a property, a bridge lender can be the far better
choice. A bridge lender that is willing to dive in and
rapidly craft a tailored financing strategy for success
is often the best choice for a commercial mortgage
broker who is seeking a lending partner for a client.
This financing flexibility might even require a lender
to evaluate and support a single deal involving two
different types of assets in two different markets.
Following is an example of such a transaction.
A property-purchase deal involving two buildings
in greater Atlanta called for the cross-collateralized
financing of an aging mixed-use building and a woefully underperforming medical-office complex. The
properties are located in separate neighborhoods.
The mixed-use loft-office and retail building is
located in the Old Fourth Ward of Atlanta, which has
become one of the hottest multifamily submarkets in
the city. Most of the reposition-based acquisitions in
the area involve ground-up multifamily projects, such
as townhouses. Built in 1940, the 18,942-square-foot
mixed-use building boasts original hardwoods, high
ceilings, exposed brick and bountiful sunlight.
With financing from a bridge lender, a sponsor purchased the vacant building in June 2017 for $1.65 million,
a price far below market value. The sponsor then
invested $200,000 to prepare the building for leasing.
The tenants now include a restaurant and a hair salon.
The property is currently 85. 7 percent occupied.
The sponsor’s other property was a medical-office
complex about 15 miles away in an Atlanta suburb,
Lithia Springs. It was a bit of a unicorn in that there
were no similar competing products nearby, but the
two buildings in the complex had been so mismanaged
and neglected that would-be tenants were settling for
flex space elsewhere for their medical practices. The
medical-office buildings date back to the 1980s and
hadn’t been painted for several years.
Still, the potential was evident. Several of the existing tenants expressed their desire to expand into
vacant space in the 48,602-square-foot medical-office
complex. The previous landlord, however, refused to
offer any tenant-improvement allowances to help the