Finance  ·  CMBS

Unilev Scores $90M Financing Package for Wells Fargo Place


Beverly Hills-based Unilev Capital Corp. has received a $90 million debt and preferred equity package for Wells Fargo Place—a 37-story office property in St. Paul, Minn., Commercial Observer can first report.

KKR provided a $70 million five-year, floating rate loan in the deal, while an unnamed preferred equity investor provided the remaining $20 million.

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The loan was previously securitized in the Credit Suisse-sponsored CSMC 2007-C1 CMBS deal. Trepp data shows the loan was transferred to special servicer C-III Asset Management in May 2016 due to imminent default and matured in November 2016. Servicing comments, also provided by Trepp, state that “month-to-month tenants and near-term lease expirations were the main issues surrounding the inability to obtain refinancing.”

Iron Hound Management’s Christopher Herron and John Wood negotiated a resolution for the loan with C-III on behalf of Unilev, then arranged the new debt and equity, sources said. 

The 635,000-square-foot building was erected in 1987 and is located at 30 East Seventh Street in downtown St. Paul. At 471 feet, it is the tallest office building in the city’s central business district, according to Unilev’s website.

Unilev acquired the property, previously known as Minnesota World Trade Center, from Zeller Realty Group in October 2006, according to an article by the Minneapolis/ St. Paul Business Journal, paying more than $100 million.

Prior to the new financing, the property was still cash flowing and well occupied but required a recapitalization in order to pay off the previous debt, sources said. 

“Through the new financing, new capital partners and a successful recapitalization, Unilev was able to pay this loan off at par, which is not the norm,” one source familiar with the transaction told CO.  

Today, Wells Fargo Place’s government and state-driven tenants include include Minnesota State Colleges and Universities, the Internal Revenue Service and—of course—Wells Fargo.

Officials at KKR (KKR) declined to comment. Officials at Unilev did not respond to a request for comment. Officials at Iron Hound confirmed their involvement in the deal but declined to comment further.