Retail Mortgage Loans
Retail Mortgage Program
Eligible Property Types
Anchored, shadow-anchored and unanchored shopping centers, lifestyle centers, power centers and outlet centers. Single tenant retail properties will be considered on a case-by-case basis.
Loan maturities are typically 5, 7, or 10 years. Other loan terms will be considered on a case-by-case basis, including 15 and 20 year maturities.
Anchored and shadow anchored centers up to a 30-year amortization schedule. Unanchored centers are typically underwritten with a 25-year amortization schedule. Longer amortization schedules for unanchored centers will be considered based upon property age and condition. Interest only periods available on a case-by-case basis.
Debt Service Coverage Ratio (DSCR)
Minimum DSCR depending upon property type, age, physical condition, location and competitive market position. Minimum DSCR: 1.20:1 anchored; 1.25:1 shadow-anchored and unanchored (DSCR may be adjusted depending upon the credit quality of the tenant base).
The lesser of 75% (unanchored), 80% (anchored, shadow anchored) of MAI appraised value conforming to FIRREA and USPAP guidelines and 95% (anchored, shadow anchored) of loan to acquisition cost (if applicable), up to 85% (unanchored).
The Borrower will typically contribute monthly to an escrow account for real estate taxes and property insurance. The Borrower will usually establish a monthly rollover reserve escrow for costs of tenant improvements and leasing commissions and a monthly capital replacement escrow reserve equal to the greater of $.15/square foot per year or an amount determined by Lender on the basis of an engineering report and Lender’s site inspection. These reserves may be waived or capped in certain instances.
Reserves at Closing
The Borrower will establish a remediation/repair reserve at closing equal to 125% of required deferred maintenance repairs as indicated in the engineering report and Lender’s site inspection and on a deal specific basis, reserves for tenant improvements and leasing commissions.