🏗️🏙️💲 Last Week's Most Unbelievable Deals: JMB Realty, HGGC, Kinetik

Good Morning TIM Enthusiasts

Last week exhibited a vibrant tapestry of deals and developments across the CRE, ABL, and Growth Cap landscapes as the market navigated a path between opportunity and caution. In CRE, JMB Realty's $575M construction loan for its LA office tower and Gotham Organization and Carlyle Group's $216M bridge acquisition financing for the Aire skyscraper in NYC took center stage. The ABL world saw Kinetik Holdings secure a $150M accounts receivable securitization facility, while in Growth Cap, Oak Hill Advisors' $400M+ unitranche financing for Rimkus Consulting Group's acquisition by HGGC stole the spotlight. However, the week also brought sobering reminders of the challenges faced by some, with Charif Souki ordered to repay $100M in a loan default case, smart glass company View Inc. filing for Chapter 11 bankruptcy, and 5G maker Airspan Networks seeking Chapter 11 protection. As we survey this intricate financial landscape, let's take a closer look at the winners, the survivors, and those reassessing their strategies in this ever-evolving ecosystem....all in a mere 5-minute act!

Let’s get into it.

Watch last week’s top 10 finance deals: https://youtu.be/Bu19VHxDUEw

Top Weekly CRE Deals

• JMB Realty secures a colossal $575M loan for its office space in L.A. Read 
  Lender: Cale Street Partners, Office Construction Loan

• M&T Bank reinvigorates Brooklyn's tower skyline with $415M refi Read
  Lender: M&T Bank, Multifamily Refinance Loan

• MF1 Capital bolsters The Aire Residential Tower in NYC with $216M Read
  Lender: MF1 Capital, Multifamily Acquisition Loan

• Apollo breathes new life into its Last-Mile Portfolio with $113M loan Read
  Lender: Apollo Global Mgmt, Industrial Refinance Loan

• Valley National earmarks $105M for Flatbush Apartments Development Read
  Lender: Valley National Bank, Mixed-Use Multifamily Construction Loan

• Bank OZK fuels St Regis Condo luxury living with a $100M investment Read
  Lender: Bank of the Ozarks, Hospitality Construction Loan

• Toll Brothers' Boston venture gains with an $81M loan from Mesa West Read
  Lender: Mesa West Capital, Multifamily Refinance Loan

• Barings champions San Diego's multifamily sector with a $78M loan Read
  Lender: Barings, Multifamily Refinance Loan

• Lincoln Property Company secures a $65M refi for its L.A. Office Complex Read
  Lender: Deutsche Bank, Office Refinance Loan

• Ready Capital ensures apartment growth in Arizona with $60M refi Read
  Lender: Ready Capital, Multifamily Refinance Loan

Summary
Last week, we saw several significant commercial real estate financing deals close across the country, highlighting the continued strength and resilience of the multifamily and industrial sectors. Notable transactions included JMB Realty securing a $575 million construction loan for its 37-story office tower in Los Angeles' Century City district, Gotham Organization, and The Carlyle Group obtaining $216 million in bridge acquisition financing for their Aire skyscraper in Manhattan, and Faropoint landing a $112.5 million loan to refinance its 42-property last-mile logistics portfolio. Despite the challenges facing the broader office market, these deals underscore lenders' appetite for high-quality assets in prime, strong locations, particularly in the multifamily and industrial sectors.

There were no clear winners, but Bank OZK continued its lending streak by extending a $100 million construction loan for the St. Regis condo project in Sunny Isles Beach. This deal adds to the bank's impressive $1.4 billion in recent lending activity across South Florida.

Construction financing emerged as a key theme, with several large loans for ground-up development projects. Despite certain sectors ' near-term challenges, the strong demand for construction financing suggests that developers remain optimistic about the long-term prospects for well-located, high-quality assets. Refinancing activity was also prominent, demonstrating the continued liquidity in the market for stabilized assets with strong cash flow.

Key Insights

• Multifamily and industrial properties remain the darlings of the commercial real estate financing market, with lenders eager to deploy capital towards well-located, high-quality assets in these sectors.

• The flight to quality trend continues in the office sector, with newer, amenity-rich properties in prime locations attracting strong tenant demand and investor interest.

• Affordable housing components are becoming increasingly important in multifamily developments as lenders and investors seek to address the nationwide shortage of low- and moderate-income rental units.

 Top Opportunities/Markets:

CRE Lenders:
1) Multifamily developers with a focus on affordable housing components
2) Industrial real estate, particularly last-mile logistics facilities
3) High-quality office properties in prime locations
4) Luxury residential developments in gateway markets

CRE Developers:
1) Explore partnerships with affordable housing advocates and community organizations to identify areas of need and build goodwill.
2) Focus on designing flexible spaces that accommodate a range of tenant needs, from collaborative areas to private offices, and explore partnerships with providers of high-end amenities like fitness centers and concierge services.

CRE Investors:
1) Explore opportunities to invest in companies that support the logistics industry, such as warehouse automation providers and delivery service platforms.
2) Consider investing in businesses catering to affluent residents' needs and preferences, such as private transportation services and high-end dining establishments.

CRE Brokers:
1) Explore opportunities to work with non-profit organizations and government agencies that support affordable housing initiatives.
2) Proactively contact office owners and offer expertise in identifying lenders specializing in value-add or adaptive reuse projects.

Top Weekly Growth Capital Deals

• OHA orchestrates $400M for HGGC's acquisition of Rimkus Consulting Read
  Lender: Oak Hill Advisors, Acquisition Loan

• Armory Securities propels Vivos Holdings with a strategic $325M Read
  Lender: Armory Securities, Working Capital Loan

• CPS celebrates the renewal of a substantial $200 million credit facility Read
  Lender: Ares Agent Services, Working Capital Loan

• Valley Bank fortifies a premier NY finance company with $150M loan Read
  Lender: Valley Bank, Growth Expansion Loan

• MidCap Financial secures an $85M credit facility for Avison Young Read
  Lender: MidCap Financial, Refinance & Working Capital Loan

• Aequum Capital spearheads a $45M revolver for a Mfg & Dist. company Read
  Lender: Aequum Capital, Acquisition Loan

• HawkEye 360 eyes expansion with $40M in debt financing from SVB Read
  Lender: Silicon Valley Bank, Growth Expansion Loan

• Capteris finalizes a $14M refi deal for a sponsor-owned manufacturer Read
  Lender: Capteris Capital, Refinance Loan

• TAB Bank boosts a Georgia packaging company with $5M credit facility Read
  Lender: TAB Bank, Growth Expansion and Working Capital Loan

• Singing Machine tunes into financial growth with $2M credit facility Read
  Lender: Oxford Commercial Finance, Working Capital Loan

Top Weekly ABL Deals

• Kinetik boosts liquidity with a new $150M AR securitization facility Read
  Lender: PNC Bank, Refinance Loan

• 36th Street provides $30M to personal care products manufacturer Read
  Lender: 36th Street, Working Capital Loan

• SLR Healthcare ABL commits $15M to support a medical device company Read
  Lender: SLR Healthcare, Growth Expansion Loan

• MidCap Business Credit finalizes a $15M ABL for Plastic Suppliers Read
  Lender: MidCap Business Credit, Growth Expansion Loan

• Pathward empowers a broadcast transmitter manufacturer with $8M Read
  Lender: Pathward, Working Capital Loan

• Wintrust unveils $4.75M LOC for a pet food and products manufacturer Read
  Lender: Wintrust Receivables Finance, Refinance Loan

• Boardwalktech secures a strategic $4M line of credit to fuel growth. Read
  Lender: Celtic Bank, Growth Expansion & Working Capital Loan

• Pathward enhances a Wisconsin logistics company with $4M loan Read
  Lender: Pathward, Working Capital Loan

• Alpine Ridge Funding injects $2.5M AR into a healthcare service provider Read
  Lender: Alpine Ridge Funding, Working Capital Loan

• Tradecycle Capital propels auto parts distributor with a $2.5M AP facility Read
  Lender: Tradecycle Capital, Working Capital Loan

Insight Summary

Last week, we saw diverse financing activity across various sectors and deal sizes. The largest transaction was a more than $400 million financing facility provided by Oak Hill Advisors to support HGGC's acquisition of Rimkus Consulting Group, a leading engineering and technical consulting services provider. This deal showcased OHA's expertise in the consulting space and its ability to deliver customized credit solutions. Other notable transactions included a $325 million refinancing for Vivos Holdings, a subsidiary of Emprise Group, which manufactures private label products across multiple categories; and a $200 million revolving credit facility renewal for Consumer Portfolio Services, an auto finance company.

Oak Hill Advisors (OHA) appears to be the top lender this week, having served as a Joint Lead Arranger for a more than $400 million financing facility to support HGGC's acquisition of Rimkus Consulting Group. The most prominent activity appears to be financing working capital needs, with several transactions involving companies seeking increased cashflow flexibility.

Key Insights

• Lenders are displaying flexibility and creativity in structuring deals to meet borrowers' unique needs, as evidenced by the variety of financing options, including unitranche facilities, asset-based loans, factoring arrangements, and sale-leaseback transactions.

• Companies in diverse industries, such as manufacturing, distribution, consulting, auto finance, and accounts receivable factoring, can secure significant financing, indicating that lenders are willing to deploy capital to businesses with strong fundamentals and growth prospects.
  

💡 Top Markets/Opportunities:
Asset-Based/Growth Cap Lenders: 
1) Engineering and Technical Consulting Firms
2) Private Label Manufacturers
3) The Auto Finance sector
4) Accounts Receivable and Factoring Companies

Family Offices
1) Satellite and data analytics companies. As the demand for geospatial intelligence grows across various industries, these firms have the potential for significant growth and value creation.
2) Health supplement manufacturers. The global wellness trend and increasing consumer focus on health could drive demand for these products, making these businesses attractive acquisition targets.

Private Equity Firms
1) Companies in the fluid power valves and hoses industry. As manufacturing and industrial activities continue to rebound, these businesses are likely to experience increased demand, making them attractive acquisition targets.
2) Medical device companies. The healthcare industry's constant demand for innovative technologies and the potential for high-margin products make these businesses appealing for private equity investment.

Brokers
1) Focus on connecting engineering and technical consulting firms with lenders that specialize in providing customized financing solutions for this industry.
2) Brokers can position themselves as valuable intermediaries by developing expertise in Factoring/AR finance companies and cultivating relationships with these companies and the lenders that serve them.

 New Lender Programs

• U.S. Bank and Levantor Capital forge a partnership to enhance loan options to optimize businesses’s supply chain efficiency Read more
  Lender: Levantor Supply Chain Loan Program

😲 Didn’t see that one coming

• Energy magnate Charif Souki faces a hefty $100M repayment order following a loan default Read more

• Smart glass manufacturer View to privatize and restructure through Ch. 11 bankruptcy Read more

• Telecommunications provider Airspan seeks Ch. 11 protection after capital expenditure crunch Read more

• Footwear brand Shoes For Crews opts for Chapter 11 bankruptcy to address its financial hurdles Read more

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