Piggy bank with gold coins

Freedom Financial Funds recently closed a bridge loan for $8.78 million to fund the acquisition and repositioning of an 81,000-square-foot neighborhood shopping center in Glendale.

When the client opened escrow to purchase Glendale Plaza, the center was mostly vacant. During escrow, the buyer obtained a new lease with EoS Fitness for a substantial portion of the center. Glendale Plaza will be at least 92% leased when EoS Fitness takes occupancy.

To make the center more functional for future customers, the buyer is also demolishing over 12,000 square feet of the existing retail space. The result will be a 69,000-square-foot center, with a parking ratio of 5.3:1.

The client chose to bring this transaction to Freedom Financial Funds rather than to his bank. It was crucial for the borrower to be able to delay his commitment to purchase until a few days before the close of escrow. At issue was the need to gain the existing tenants’ approvals for an EoS Fitness. The approvals were ultimately obtained only one week before escrow was scheduled to close. Freedom was able to accommodate the client’s unique circumstances, allowing him to avoid financing costs until he was certain he could close under conditions with which he was comfortable.

Freedom Financial Funds recognized the substantial increase in value being created at the property and structured a loan that rewarded the borrower for that value, at 90% loan to cost but just 62% loan to value. This structure allowed the borrower to close the transaction with his own resources, thus avoiding the high cost of bringing in an equity partner.

Freedom Financial Funds manages a private REIT and separate accounts through which it responds to the financing needs of real estate professionals seeking capital for construction, rehabilitation, repositioning, conversion or additions to commercial and residential properties in the western United States. Freedom also offers build-to-suit financing nationally. In five years, Freedom has executed nearly $500 million in transactions and has remained steadfast throughout the COVID-19 crisis.