Arapahoe Service Center I

Transaction Details

Arapahoe Service Center is a three building, single-story office/flex property located along the Arapahoe Road corridor in Centennial, CO. The property was developed in 1985 and consists of 144,341 square feet of rentable area. Arapahoe Service Center has approximately 50% office finish, has a mix of dock high and drive-in doors in the back of the property, and clear heights that range from 9' to 14'.

The Proposition

Essex was approached by its private capital client to help arrange permanent acquisition financing in accordance with its long-term holding period. The private capital client's objectives were to maximize loan proceeds, fix a low interest rate for a long period of time, and have the ability to prepay early without a substantial penalty if successful in moving the in-place rents to market, which were $1.50/SF on average below current market levels.

Our Solution

Essex Financial Group arranged a 15-year, non-recourse acquisition loan with an exclusive correspondent life insurance company at 71% of the purchase price. The fixed rate loan has a competitively low interest rate with a 25-year amortization and a step down prepayment penalty starting in Year 7, which opens up at 1% starting in Year 12. The loan was closed in 60 days and met the client's contract closing date of March 1, 2016.