Ethos sourced the acquisition financing for Eastport Plaza, a neighborhood shopping center with 42 tenants that included a gym and movie theater. Built in 1980 and renovated in 2010, the shopping center was well-maintained and centrally located, but a combination of factors—near-term lease expirations, multiple tenants on ground leases, and one major lease yet to commence—added complexity for potential lenders. Ethos was tasked with finding a lender who could meet interest rate and leverage targets and could structure around an abundance of moving pieces.
Ethos brought Standard Insurance, a unique life company lender that will take more risk than other life insurance companies. As a local lender, Standard valued the asset, understood the market, and overcame deal complexity and lower occupancy at close. Their ability to structure two months of principal and interest payment reserves around the one lease not commencing for several months set them apart from banks and credit unions.
Standard locked the borrower’s interest rate at application, removing any market volatility for the sponsor and ultimately benefitting the borrower. The primary obstacle when financing this project was the requirement to close several months prior to a major lease commencing. Ethos was able to structure a two-month reserve of principal and interest payments to meet debt service coverage requirements, allowing Standard to accommodate the acquisition closing timeline.
Ethos Services
Associated Team Members
- Daniel Natsch
- Senior Managing Director, Partner
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- Matthew Illias
- Senior Managing Director, Partner
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