Transaction properties

Red Oak provided $1,733,750 in financing to purchase and rehabilitate a three-story 40,000-square-foot office building located in Homewood, AL in the Birmingham market. The property at 85 Bagby Dr.is a multi-tenant general use office, located just off Hwy I-65 in the market’s CBD. The buyer is an experienced property developer and manager. The building was 80% occupied and will undergo regular updating and renovations to bring it up to a Class A/B building. The borrower expects occupancy to hit 100% withing six months. The site is located directly across the street from a new $21-million public safety building, which will house all public safety departments. Conventional financing was not available for the property as a result of maintenance and upgrades needed, as well as the high vacancy. Red Oak understood that the asset performance however was strong, with a net operating income of $243,541 and an expected DSCR of 1.25. The borrower’s exit strategy is to obtain conventional financing after the rehabilitation and stabilization is completed, in approximately 6 to 8 months.

Red Oak delivered $5,615,000 in acquisition financing for an existing 25-bed acute care hospital campus located in Plymouth, NC. The facility at 958 US-64 includes an additional four medical office buildings, two general office buildings, and an additional 16 acres of land, or out-parcels, available for future development.

The facility was acquired from the federal court system, which controlled the property and had assigned the management of asset to Affinity Health Partners. The borrower is an experienced national healthcare management provider, which had been managing and operating the facility for the past nine months.

The property is a retail shopping center located southeast of Cleveland, Ohio, in the suburb of North Randall. It is located on a major Class-A road in a highly commercial district. The retail shopping center consists of 7 spaces and is currently at 90.3% occupancy. Tenants include a daycare facility and a tanning salon. The shopping center consists of approximately 29,000 SQFT, with Family Dollar to occupy 8500 SQFT. The property was appraised in March 2019 for $2,550,000 and the NOI for the project is approximately $293,500 per year.

The Borrower purchased the property in 2013 for $770,000 in a foreclosure auction and invested over $500,000 in repairs, upgrades, and secured a new credit-rated tenant – Family Dollar to be the anchor for the retail center for a new 10-year lease. Approximately $200,000 of repairs remain, thus the refinance would contribute towards paying off the contractors.