ValueXpress has arranged a $28-million CMBS conduit loan for the refinance of an eight building office suite portfolio located in Indianapolis, Indiana and Frisco (Dallas), Texas. The transaction provided significant cash-out loan proceeds to allow the sponsor, Scott Yeager, to continue to grow the portfolio by utilizing the excess loan proceeds as construction loan equity to build additional projects under the Yeager Office Suites brand. The next project will be located in Plano, Texas. Scott is eying the Phoenix market for additional Yeager Office Suites projects. The portfolio was 100% occupied at closing.
Nationally, firms have developed the office suite concept by developing entire space-purposed suite buildings or by developing leased block space in which the operator builds out block space into suite spaces and associated amenities, then subleases the individual suite offices. These firms make spread income between the total rents collected from the suites versus the rent paid to the landlord for the block space. Scott Yeager and Yeager Office Suites is one of few developers that has elected to develop and own suite space-purposed buildings.
The loan provides for a 10-year term with a 30-year amortization schedule and is non-recourse. Financing was provided by an active CMBS conduit lender that has an ongoing relationship with ValueXpress to arrange additional CMBS conduit loans.