• Bridge Loan
  • 3-Year Term
  • 64.41%
  • West Office

Bridge Loan for Medical Office Building in Sacramento, CA


Red Oak Capital provided a $9,000,000 loan under its’ Opportunistic Bridge Program for the Scripps Medical Office Building, a 35,390-square-foot, three-story medical office property located in Sacramento, CA. The ground-floor of the 1973-built asset was damaged by a fire in late 2021, which required the building to be vacated and remediated. The previous owners received an insurance pay-out and elected to sell the building at a significant discount the Borrower, allowing them to purchase and renovate the building. The Sponsor, Jeffery Berger, is a highly successful commercial property operator and investor, who was a previous owner of the building and re-purchased the asset with the purpose of bringing it back to its pre-fire condition.

The property sits on a 1.93 acre, irregularly shaped, level site at 2 Scripps Drive north of Highway 50 and the American River, approximately four miles east of Sacramento’s Downtown District and the market’s Central Business District. The immediate area is primarily developed with office, medical office, retail and service commercial properties as well as single- and multi-family residential properties. The property is of wood frame construction with stucco exterior walls.



Red Oak Capital provided the Borrower/Sponsor capital to acquire the property, along with additional proceeds to renovate the building, cover soft costs, tenant improvements and leasing commissions. The loan was structured with an 18-month loan term with three (3) 6-month renewal options and a Note Rate of 10.00%. The loan represented 64.41% of the “As-Stabilized” value of $13,600,000.



Red Oak Capital recognized the potential value in the Borrower’s plan to acquire the property, complete the remediation caused by the fire, as well as execute the lease-up of vacant space in order to stabilize the asset. The property was 60% leased at the time of acquisition and is expected to achieve stabilized occupancy of 95% by November 2025. The Borrower intends to increase occupancy and rental rates through securing new lease extensions with current tenants and using the tenant improvements to bolster the occupancy.

The Sponsor has a successful track record of acquiring and operating commercial properties since 2002. He previously owned the property, and successfully executed a lease-up and sale. Despite the office market challenges from the COVID pandemic, that issue is largely behind the country and companies are continuing to bring employees back to offices. The proximity of the location to downtown Sacramento and the offering of rejuvenated medical office space are expected to appeal to new tenants coming into the market. Additionally, the Sacramento Central Business District is attractive because it currently ranks among the top 50 in the U.S. in terms of population, demographics, and employers, all of which is expected to drive demand for updated assets such as 2 Scripps Drive.