Bay Area Company Tops This Week's Most Mind-Boggling Loans: PGIM $668M, White Oak $1.1B, First National $148M

Good Morning Everyone

This week in Deals:

$2.37 billion in top 10 CRE deals
$2.32 billion in top 8 Growth Cap deals
$203.5 million in top 10 ABL deals

Top CRE Lenders
Bank OZK, Related Fund Management, Madison Realty Capital, Blue Sky Servicing, First Citizens Bank, Wells Fargo, Argentic Real Estate Finance, CIM Group, Goldman Sachs, Acore Capital

Top Growth Cap Lenders
Wells Fargo, PNC Bank, First Citizens Bank, Victory Park Capital, HSBC, J.P. Morgan, Stifel Bank, Hercules Capital, Texas Capital Bank, Morgan Stanley Expansion Capital, Bridge Bank

Top ABL Lenders
First National Capital, eCapital, Dwight Funding, Wintrust Business Credit, SLR Business Credit, Legacy Corporate Lending, Rosenthal & Rosenthal

🌆Top Weekly CRE Deals

• PMG scores a $668M record construction loan for Waldorf Astoria Tower in Miami Read

• Vornado lands $400M refi for Manhattan mixed-use tower Read

• Related secures $400M for luxury condos on exclusive Fisher Island Read

• Bardas and Bain Capital’s Hollywood studio project secures $300M loan Read

• First Citizens Bank arranges $133M financing for Massachusetts battery energy storage project Read

• Howard Hughes lands $130M refi for Houston-area office tower Read

• Applied Digital secures private debt facility of $125M to accelerate HPC data center project Read

• Goldman Sachs provides $120M acquisition loan for 680 Madison purchase Read

• Republic Properties lands $96M refinancing for Portals office building Read

• Acore refis Queens industrial property with $69M loan Read

Summary

What a week for Miami and Related! In a series of significant commercial real estate financing deals, the highlight was a monumental $668 million construction loan from Bank OZK and Related Fund Management for the Waldorf Astoria Hotel & Residences in Miami. This landmark financing is set to support the construction of one of the tallest buildings in the southern United States.

Adding to the momentum, Related Group secured a substantial $400 million from Madison Realty Capital for a luxury condominium project on the exclusive Fisher Island. The flurry of activity didn’t stop there. A $300 million construction loan from Blue Sky Servicing was secured for a major studio and office development in Hollywood, while a $133 million deal was closed for a utility-scale battery storage project in Massachusetts.

This week's spotlight was on luxury condos, office developments, and industrial properties, with construction loans for ground-up developments leading the charge. Bank OZK emerged as the top lender, spearheading the financing landscape with its record-breaking $668 million loan for the Waldorf Astoria in Miami. This is believed to be the largest construction loan ever in South Florida.

Over $1.4 billion in combined financing was provided for the Waldorf Astoria, Fisher Island condos, and Echelon Studios projects. Miami was undeniably the star, attracting over $1 billion in construction financing across these high-profile condo deals. This wave of investment underscores Miami’s unwavering appeal as a hub for high-end condominium development and investment. Meanwhile, Los Angeles, New York, and Houston also saw notable activity, rounding out the list of top locales with the most lending action this week.

Key Insights

• Luxury condos, especially in Miami, continue to attract enormous construction loans on the back of record-setting pre-sales

• Despite a slowdown in parts of the debt market, top-tier office and studio developments are still securing sizable financing

• Battery storage is emerging as a sought-after asset class for lenders as renewable energy gains steam

Loan Structures
While most loans span a respectable 3 to 10 years, construction loans tend to be the sprinters of the bunch, with shorter terms that align with the project's timeline. Take Vornado Realty Trust's $400 million refinancing of 640 Fifth Avenue, which locked in a seven-year term at a fixed 7.47% rate. On the other end of the spectrum, Portals II, a government-occupied office building in D.C., secured a marathon 10-year refinancing from a pension fund. Meanwhile, Howard Hughes Corporation's $130 million refi for its office tower in The Woodlands clocked in at a modest five years. As for construction financing, Bardas Investment Group and Bain Capital's $300 million loan for their Echelon Studios project comes with a three-year term and a one-year extension option. With lenders offering a mix of fixed and floating rates, recourse, and non-recourse options, the lending landscape appears to be as competitive as ever for top-tier sponsors and assets.


Winners:

• CRE Brokers

• CRE Valuation Professionals

• Bank OZK (largest construction deal in South Florida)

• Madison Realty Capital (second week with a large transaction)
  

Losers:

• Less-established and smaller developers

• Owners of older, lower-quality assets

• Regional Banks

• CMBS Lenders

💡 Top Markets/Opportunities:

CRE Lenders Focus:
1) High-end residential projects in the Miami MSA
2) Office and studio development financing with content production companies, post-production service providers, and other media-related tenants
3) Renewable energy developers, utilities, and equipment manufacturers
4) Tech companies, cloud service providers, and telecom firms

CRE Developers Focus:
1) Projects with top-tier architects, designers, and marketers
2) Acquire land and entitle new office developments in The Woodlands submarket
3) JV with experienced energy developers and target strategic sites

CRE Investors Focus:
1) Well-leased, trophy assets in the Manhattan submarket
2) Last-mile distribution centers, multi-story warehouses, and other infill assets
3) Repositioning and adaptive reuse plays with retail condos

CRE Brokers Focus:
1) Developers with a proven track record and projects that boast strong pre-leasing or pre-sales
2) Mine your database for maturing loans on stabilized, cash-flowing properties for refis
3) Build relationships with owners and developers active in rising secondary markets

💸Top Weekly Growth Capital Deals

• White Oak Commercial Finance receives $1.1B credit facility from Wells Fargo Read

• PNC Bank announces $500+ million credit facility for Seismic Read

• First Citizens Bank provides up to $400M for WhiteHawk Funds Read

• Pipe expands Capital-as-a-Service capacity to more than $1B per year with a new $100M credit facility from Victory Park Capital Read

• HSBC, J.P. Morgan, Stifel Bank, and Hercules Capital provide $100M credit facility to Electric Hydrogen Read

• Natural Gas Services Group announces expansion of credit facility by $75M Read

• Mad Mobile secures $50M in funding from Morgan Stanley Expansion Capital and Bridge Bank Read

• Weatherford announces expansion of $40M credit facility and amendment of accordion size Read

Top Weekly ABL Deals

• First National Capital provides $148M in financing for natural gas turbine generators Read

• Dwight Funding closes new transactions over $22M, highlighting commitment to consumer brand growth Read

• eCapital breaks through single-debtor barrier with $15M invoice factoring facility for disruptive transportation tech firm Read

• Wintrust Business Credit announces closing of $11M ABL line of credit to support client acquisition of premium fresh food distributor Read

• SLR Business Credit provides $7.5M line of credit to rapidly growing artisanal baked goods manufacturer Read

• Legacy Corporate Lending provides $7M credit facility to PostWorks New York Read

• Rosenthal closes $2M recourse factoring deal for New York-based staffing firm Read

Summary
Last week's lending activity spanned various sectors and deal sizes, headlined by three major loans: White Oak Commercial Finance's $1.1 billion credit facility, PNC Bank's $500 million credit facility for Seismic, and First Citizens Bank's $400 million financing for WhiteHawk Capital Partners funds. Other notable transactions included Victory Park Capital's $100 million credit facility for Pipe and First National Capital Corp.'s $148 million financing for a Puerto Rico energy infrastructure project. Lenders have shown a strong focus on technology, energy, transportation, and consumer goods sectors. Borrowers ranged from large international firms to high-potential startups and well-established mid-market players.

The predominant use of proceeds has been for growth capital aimed at supporting strategic initiatives and market expansion. Borrowers included fintech platforms, funds, energy and infrastructure, and technology companies. Wells Fargo and Dwight Funding were the most active lenders this week. Wells Fargo led two significant transactions, including a $1.1 billion credit facility for White Oak Commercial Finance to expand its asset-based lending globally and a $500 million senior secured credit facility for Seismic, a sales enablement software leader. Meanwhile, Dwight Funding closed three deals totaling $22.5 million, providing lines of credit to emerging consumer brands in the beauty, beverage, and apparel industries, showcasing its ability to offer flexible growth capital to startups across various sectors.

Significant lending activity was also observed across various regions in the United States, including New York City, Puerto Rico, Minnesota, and Massachusetts. Key transactions were noted in the energy, technology, and business services sectors.

Key Insights

• Asset-based lending remains an active area as banks partner with specialty finance firms to meet market demand

• Software and specialty lending funds are attracting significant credit facilities to fuel expansion

• Fintech and energy infrastructure are securing large financings, often with an innovation or impact angle
  

Loan Structures
The most common tenor among these deals was focused on growth capital, with facilities structured to support strategic initiatives, market expansion, and acquisitions. Loan durations varied, with multi-year facilities like White Oak Commercial Finance's $1.1 billion asset-based lending facility and PNC Bank's $500 million senior secured credit facility for Seismic standing out as prime examples of this trend.

Winners:

• Fintech platforms

• Private equity and specialty lending funds

• Venture debt and growth capital providers

• Asset-based lenders

Losers:

• Under-capitalized software firms

• Traditional finance firms slow to innovate

• Lenders that are slow to build relationships with ascending companies

• Generalist lenders lacking domain knowledge and creativity

💡 Top Markets/Opportunities:
Asset-Based/Growth Cap Lenders Focus 
1) Specialty lending funds are seeking financing to scale
2) Software companies are attractive lending prospects
3) Companies in consolidating industries that are pursuing inorganic growth strategies
4) Infrastructure projects need flexible financing solutions

Family Offices Focus
1) Fintech platforms are attracting significant growth capital
2) E-commerce enablement is a hot space
3) Energy tech is a sector to watch

Private Equity Firms Focus
1) Enterprise software remains a strong bet
2) Natural gas infrastructure is an attractive space
3) Retail tech is a sector in transition

Brokers Focus
1) Recurring revenue financing is a growing niche
2) Brands are hungry for growth capital
3) Lenders have an appetite for energy deals

😲 Didn’t see that one coming

• Common Living goes belly up and files for bankruptcy Read

• CalAmp files bankruptcy to complete lender-backed restructuring Read

• APF Properties faces potential foreclosure after New York office loan default Read

• LaVie Care Centers files for Chapter 11 bankruptcy protection Read

• New England solar installer iSun files for Chapter 11 bankruptcy Read

• Rubio’s Coastal Grill files for Chapter 11 bankruptcy protection Read

• Byju's lenders kick off bankruptcy proceedings in the US over a $1.2B term loan Read

• Fisker Inc. bankruptcy looms as latest SEC filing shows it has defaulted on a $3.5M loan Read

• MetLife is foreclosing on a Starwood and Artisan Ventures-owned El Segundo office building Read

• Maryland’s Station Square offices set for foreclosure sale Read

• LuxUrban faces $83M lawsuit from REIT as more landlords try to evict 'WeWork for Hotels' Read

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