Versant Completes $64,000,000 Recapitalization of Britannia Business Center I in Pleasanton CA
Assists tenant-in-common owners with new financing, partial purchase of investor equity and IRC Section 721 rollup
SAN DIEGO, Dec. 21, 2015 /PRNewswire/ -- Versant Commercial Brokerage Inc. announced today that it has successfully recapitalized Britannia Business Center I located in Pleasanton, California. Versant assisted the tenant-in-common investors by originating new debt financing, bringing in new equity to stabilize the property, purchasing the TIC interests of those who needed to exit the investment, and utilizing Internal Revenue Code Section 721 to roll up the TIC structure into an LLC on a tax-deferred basis.
In 2012, almost all of the tenant leases were scheduled to expire over the next 24 months. In addition, the loan was maturing at the same time. The TIC investors did not have a business plan or enough equity in the property to refinance through conventional channels. The investors hired Clear Vista Management to manage and restructure the investment, and Versant to raise the new capital.
Clear Vista first focused on retaining existing tenants and cutting operating expenses to drive value. Clear Vista, with the assistance of the leasing brokers at Newmark Cornish & Carey, was able to retain a major tenant and then bring occupancy up to 82%. Clear Vista reduced operating expenses by almost 20%, which increased the value of the property. The TICs then looked to Versant to design a financial solution that preserved their tax deferral and provided an opportunity to recover a significant portion of their original investment.
Versant designed and completed a very complex recapitalization. With the crucial assistance of Ethan Schelin of Landmark Capital Advisors, Versant originated new senior debt and two separate classes of subordinated financing, totaling $64,000,000. Versant designed the capital structure to maximize current equity and protect tax deferrals.
"When we took over Britannia the property was $20MM under water," said Quinn Palomino, Principal at Clear Vista and Versant. "This was a very difficult undertaking and our teams spent countless hours creating the best solution for the owners. We are delighted that this has worked out so well for the investors."
"We appreciate the years of effort that Clear Vista and Versant put into saving this property," said Dale Shoup, investor steering committee member. "Without their vision and diligence the investors would have lost this property to foreclosure. We are happy to continue to own such a quality asset in one of the most dynamic markets in the country."
About Versant Commercial Brokerage
Versant Commercial Brokerage, Incorporated is a commercial real estate firm that focuses on recapitalizing tenant-in-common owned properties. Versant specializes in providing high quality investment opportunities for individual investors by creating access to exclusive deals. Our professionals have consulted on over $3,000,000,000 of commercial real estate engagements.
Through a private network of investors, we provide debt and equity capital for commercial real estate projects. Our network of relationships, sophisticated analyses, and experience in deal structuring give us unique capabilities to place debt and equity for real estate projects nationwide.
Please visit http://www.versantcre.com to learn more about our investor services.
Media Contact:
Derek Uldricks
6197649633
SOURCE Versant Commercial Brokerage Inc.
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