Blackhawk Featured Investment Property

Property ID #847

Why we like this deal?

Borrower looking for refi loan on 198,973sf property on 6.48 acres in Pontiac, MI. Property is 100% leased to two tenants, both about one year into new 13 year leases. First tenant is a non-profit human services agency serving local counties and the second tenant is a well regarded charter school. Loan will replace existing 1st mortgage (about $11.5M) and cashout older equity partners who have had cash and personal guarantees tied up for years.

The loan to value (LTV) provides a 37.5% cushion of equity.
Additionally, the rental income is $1,738,826 annually and is 2 times the debt service coverage ratio (DSCR). This opportunity presents an investor with a commercial note at 6% for 3 years, secured by a recorded first mortgage lien or deed of trust on this property.

Why the bank can’t lend

Local conventional banks won’t lend to non-profits or charter schools.

Risk Analysis

We consider the risk to be low relative to the loan to value (LTV).

Property Summary

Property Type: Office
Property Value: $23,184,346
Loan Amount: $14,500,000
LTV: 63%
GOI: $1,738,826
DSCR: 1.999
Loan Term: 3 years
Amortization: interest only
Recourse: yes
Cross Collateral: no
Max Rate: 6%

Borrower Summary

Source of Income: Rental Income
Documentation: Available
Guarantees: no
Payment History: N/A

Risk Summary

Overall Risk: low
Market Risk: low
Property Risk: low
Borrower Risk: low