News
Big Moolah for Moffett
April 25, 2012
| Construction lending is still tight, but when the stars are aligned, financing can be achievable. (So check your horoscope today to see if a construction loan is in your future.) Look at Moffett Towers Phase II—Jay Paul Co just received a nearly $285M construction/bridge loan for the 1M SF, Class-A mid-rise office project in Sunnyvale. |
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| Yesterday we chatted with John West, SVP of commercial real estate for US Bank, the deal’s lead bank. He tells us the project "hit all the benchmarks" (of which sponsorship is No. 1)—Jay Paul as the developer, Moffett Towers as the property, and Silicon Valley as the market. Tech companies aren't just looking for 5,000 SF, he notes; they’re looking for 500k SF spaces. (Why fill one floor when you can fill a whole block?) “Moffett Towers Phase II, right at the epicenter of the tech world in Silicon Valley, was a perfect fit.” The deal took six months from start to finish. The other banks involved are BofA, JP Morgan Chase, and Wells Fargo. |
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| Moffett Towers Phase I. Construction on Phase II already is under way, with completion slated in 2013. According to John, the proof that the project is best in class is that "four banks all agreed to step in and provide financing.” That said, the market is still bifurcated. Financing is readily available for the A quality properties with premier sponsorships in the Class-A locations. The hot spots are on the bay's interior core—those cities touching the bay (including San Francisco, natch). Outside that, you're in the first loop of suburbia, and leasing and economic activity in those markets aren't as strong. |
