Looking to acquire a single-tenant light industrial property in Port Jervis, NY, a group of private real estate investors turned to Red Oak Capital. Situated on nearly two acres at 35-41 Mechanic St. in Orange County, NY, the 45,500-square-foot facility was built in 1956 and renovated in 1984. The Class “C” warehouse/distribution building contains 8,750 square feet of office space, heavy power and four exterior loading docks. Classic Tiles, a mid-size regional importer of Italian porcelain and ceramic tiles, has preleased the facility under a long-term deal.
Red Oak provided a $2.5-million bridge loan with a 12-month term and two 6-month renewal options. The transaction had a LTC of 90.15% and an LTSV of 58.82%. Once the tenant has taken occupancy and property is stable and cash flowing, the borrower plans to exit the Red Oak loan via a permanent loan from a local or regional bank or credit union.
The sponsors are experienced real estate investors with a diverse portfolio of income-producing properties in the marketplace. Classic Tiles will lease the entire building under a 10-year deal with a five-year renewal option. The president of company, a recognized leader in its field with headquarters nearby, has personally guaranteed the contract.