When Remington was engaged, the property was 50 percent vacant, in significant disrepair and its senior financing was in default. Despite these obstacles, Remington quickly secured financing commitments from two prominent banks that became comfortable with the submarket and its ability to support higher rents. The loan provided 100 percent of the costs to refinance existing debt, fund renovation costs and an interest reserve. The pricing was one percent over Prime with a three year term. Upon stabilization, the loan converts into a competitively priced long term permanent loan. This property was the borrower’s fourth financing transaction arranged by Remington.

Remington Financial Group, headquartered in Arizona, is a national real estate investment bank that arranges and provides bridge, mezzanine, equity, construction and permanent financing to projects ranging from income producing real estate to residential lot development and condo conversions.

This transaction is an example of such a circumstance. One of Florida’s most prominent real estate families engaged Remington on an exclusive basis to secure new financing for their center and also coordinate the defeasance of their existing mortgage. Remington advised its client to fix the rate at application which paid off as the Treasury was over 4.25 percent at the time of closing. Remington’s lender provided an 80 day rate lock without cost to the borrower. Remington provided defeasance services without cost to the client as well, both examples of how extremely low transactional costs were passed onto the borrower as a result of working with Remington.

Remington recognized that this portfolio was not an asset that the lender wanted. Based on its standing relationship with the existing lender, Remington was able to negotiate a discounted pay-off on the senior financing. This event triggered a taxable liability to the borrower that required additional funding to fund this expense. Also, the environmental problem required significant funding to correct. To solve these needs and the need for additional funding to invest into the properties to help reposition and upgrade the portfolio and make competitive within its market, Remington had to secure mezzanine financing for a very speculative business plan.

Remington was able to secure market rate non-recourse senior financing and participated in the mezzanine funding tier to provide a $58MM package of financing that allowed the borrower to retain 100 percent ownership in the properties and emerge from bankruptcy. The transaction closed in 45 days.

Remington provided the company with a full range of financing options to correct its problems. The sale leaseback option was chosen as it solved several problems at once. By selling its real estate to one of Remington’s investors, the company received 100 percent of the building’s market value, engineered a favorable long term lease that was less costly than its original debt service and provided funding to fund company initiatives to rebuild its business while simultaneously reducing its taxable exposure. The company has retained Remington as its outsourced finance department to arrange additional asset based financing as it re-establishes profitability.

The lender’s willingness to provide higher leverage – 97percent LTV, more flexible terms, lower rate certainty and speed to closing over its competitors – made the decision easy for the borrower. The mezzanine financing was structured to be subordinate and coterminous with the $12MM senior CMBS financing and allowed for repayment at anytime after 12 months without penalty.

Remington competed with the borrower’s options and won based on the extremely low rate it was able to secure along with other favorable terms such as low reserves and short time frame to close. This transaction was the seventh property financed by Remington over its long term relationship with the borrower which has been established on the borrower’s confidence in Remington’s execution and reliability. The financing was structured with a 10 year term, 30 year amortization and a fixed rate of 5.35 percent.

The borrower had no experience, below average credit and very little net worth. However, it had a sales contract on a solid real estate property at an attractive purchase price. Remington was able to get comfortable with the deal based on the strength of the property and the borrower’s demonstrated business acumen throughout the financing process. As a result, Remington structured $960,000 senior and mezzanine financing which represented a 95 percent LTV when combined with the seller financing which occupied a third mortgage position. The senior and mezzanine financing was provided at a blended rate of 7.75 percent over a seven year term and 25 year amortization.

Remington worked with the developer and created a finely tuned sense of the market and felt comfortable with the property’s projected lease-up. As a result, it was able to articulate the deal and its risks efficiently to its investor and delivered a $1.5MM mezzanine loan in approximately 10 days.

Shortly after closing, the developer secured a lease and required additional funding to continue with building improvements. Remington delivered another $1MM about four weeks after the first closing by simply adding to the principal balance of the original mezzanine loan. Based on the developer’s satisfaction with Remington’s execution of the mezzanine loan assignment, it awarded Remington the senior mortgage refinancing.

Remington was able to demonstrate to its investor that the builder’s contract of sale created value for a JV equity investor. By properly staking the deal with 100 percent of the required equity, the deal was able to attract competitively priced 80 percent LTV non-recourse financing. The equity funding received a preferred return and 50/50 share of profits.