Altoma Real Estate Advisors LLC Announces the Closing of (2) CRE Loans in Q1 2015
Altoma, a CRE mortgage and capital markets intermediary based in California, successfully placed and closed a $4,550,000 loan for a Class B industrial flex space building in the Seattle, WA MSA on January 30th, 2015. On March 9th, 2015, Altoma also placed and closed a $12,500,000 loan for a Class B- multi-family property in the Portland, OR MSA.
Of the company's recent closings, Altoma Principal Dean Sparks said, "Competition is overwhelmingly fierce right now for commercial real estate financing. With the wave of maturities from pre-credit crisis vintage, there is a quiet race to take-out all this debt. We keep our pencil sharp, set honest expectations, and work very hard to deliver the best for our clients. If a client calls me at 10 o'clock at night with a question or concern, that call is answered. Sometimes that's what it takes, but it works."
The first closing of the year was a take-out loan for a 100% occupied, 55,250 SF industrial flex space building in the Seattle area. The opportunity was symbolic of the value a good mortgage banker can bring to the table. On a short time line, Altoma delivered the borrower (4) quotes; 1 from a bank, 2 from life cos and 1 from CMBS. Competing against a direct and long term relationship, Altoma's delivery of a 50% LTV, $4,550,000 loan fixed for 10 years at 4.22%, with full term I/O, sealed the deal. Comparatively, the terms provided significantly higher cash flow yield versus the alternative(s). Equally important to sealing the deal was a more flexible and creative rollover reserve structure to offset near-term rollover risk of the largest tenant, which comprised over 30% of the NRSF.
Moving south for the second closing of the year, Altoma was tasked to exclusively place the take-out loan for a Class B-, 97% occupied, 216 unit multi-family property in a Portland suburb. Before engaging Altoma, the borrower, looking to move away from agency debt, worked with other mortgage brokers and also went direct to attempt a take-out that matched their requirements. The request was a full-boat loan to achieve substantial cash-out to retire partner equity and provide much needed liquidity. The $12,500,000 loan closed at 71% LTV at the full proceeds quoted, with terms indicative of up to 75%. The potential for more proceeds was thwarted only by debt yield, which hit the 8% bottom. The 10 year loan with 14 months I/O closed at 4.37%, giving the borrower an amortized periodic payment commensurate with the previous loan's periodic payment, albeit with tremendous equity in-pocket and un-trapped.
Although based in California, Altoma has found the northwest to be a particularly favorable market to work in. On top of recent closings, Altoma has additional loan placements in due diligence awaiting closing, as well as loan terms out for negotiation in Oregon, Washington, California, Arizona, and Oklahoma. As to the geography of their clientele, Altoma Principal Dean Sparks said, "We will go anywhere in the USA for a deal, and if we don't know the market, we will educate ourselves. On that note, we will continue to forge relationships with quality sales and leasing brokers in the local market(s) that generously provide us valuable insights. Doing deals on home turf is great, but we also enjoy going outside our sandbox. It makes us that much more qualified to do a second or third or fourth deal in the respective market."
About: Altoma Real Estate Advisors LLC is a commercial real estate mortgage and capital markets intermediary based in California. Founded by Dean Sparks in 2012, Altoma started focusing solely on CRE debt placements by 2014, and quickly established themselves as an "outlier." Altoma advises on financings from $1mm to no ceiling, in all CRE asset classes, and in every investment profile. Their clients range from large developers and operators to principals with a single asset.