Cathedral City, CA
|DATE OF FUNDING||12/12/2014|
|GROSS LOAN AMOUNT||$660,000|
|LOAN TO VALUE||63%|
|NET NOTE RATE||7.95%|
|TERM OF INVESTMENT||12 Months with 6-month Lockout|
Cathedral City, CA
$660,000 FOR THE REFINANCE
OF A LIGHT INDUSTRIAL/AUTOMOTIVE BUILDING AN OFFICE PROPERTY AND TWO PARCELS OF LAND IN CATHEDRAL CITY CA
The sponsor sought $660,000 cash out refinance on 2 properties in one cross collateralized loan. Cathedral Canyon is a light industrial/automotive building and Kieley Road is a light industrial/office building. The purpose of the loan is to pay off a combined $560,000 in existing debt and a legal settlement. The remaining $100,000 balance will be used for minor building improvements and closing costs. Borrower was unable to utilize traditional bank financing due to low credit scores caused by a Chapter 13 filing from a failed real estate development project started in 2008. Two additional debt free land parcels located on Ramon Rd in Cathedral City were added to the collateral for additional security for a combined LTV of 63%.
Built in 1977, the Cathedral Canyon property is a 100% owner occupied auto body repair business operated by the sponsor for the past 17 years. The land area is 18,296sf with a modern equipped shop and offices totaling 6,978sf. The business is healthy and generates sufficient cash flow to service the debt. Market value per sf is $75 and we are lending at $51.40 per sf.
Built in 1970, the Kieley Road Property is a 4,315sf 2-story 8-unit office building with light industrial zoning. The property is fully occupied by 3 tenants, one of which is the sponsor. The Kieley Road location is utilized as an auto detailing shop for the body shop. This property is accessed through the alley behind the main body shop, directly across Kieley Road. Market value per sf is $89.34 and we are lending at $60.75 per sf.
The 2 buildings are located at the edge of the business district in Cathedral City, CA. The properties are situated between other industrial and service related businesses and have good exposure to local traffic via Cathedral Canyon Drive, which is a main artery for local traffic.
The 2 flat land parcels are contiguous and possess 16,987sf. The zoning is commercial and in a great area, located directly across the street from a Super Walmart and Office Depot. The concluded value on both parcels is $150,000.
Borrowers exit strategy is to seek conventional bank financing in the next 12 -18 months.