New York Life Lends $144M to Hines to Refi California Office Complex
By Mack Burke May 7, 2018 11:36 am
reprints![](https://commercialobserver.com/wp-content/uploads/sites/3/2018/05/intersect-email.jpg?quality=80&w=755)
New York Life Insurance Company has provided a $144 million loan to a joint venture that includes Houston-based global real estate investment firm, Hines, to refinance the Intersect, a four-building office campus in Irvine, Calif., according to a release from brokerage HFF.
The three-year, floating rate loan includes extension options, and the proceeds will be used to refinance existing debt and fund a lease up of the remaining vacancies at the properties, according to information from HFF.
The buildings are within the Orange County submarket and are located at 17875 and 17877 Von Karman Avenue and 17872 and 17838 Gillette Avenue in the Irvine Business Complex.
The campus comprises four buildings, totaling 421,900 square feet, on 15 acres of land.
Hines has planned extensive capital improvements to the properties’ open spaces and common areas, including the additions of conference and fitness centers, new outdoor workspaces, lobbies and restrooms. The firm is also planning to upgrade the property’s landscaping and is considering the inclusion of additional retail tenants, according to information about the property from Hines’ website.
Kevin MacKenzie, John Chun, Jamie Kline and Peter Thompson comprised the HFF debt placement team that represented the borrower. HFF’s Michael Leggett and Derreck Barker assisted in the transaction as part of the firm’s investment advisory team. HFF declined to comment on the financing.
“[This deal] is a great example of a sponsor strategically managing their business plan to take advantage of capital market dynamics,” MacKenzie said in prepared remarks. “By working together with our investment advisory team to establish value, and then structuring the financing offer properly based on current metrics in the debt markets, the sponsor was able to partially recapitalize the asset midway through the business plan while significantly reducing their cost of capital.”
Hines first acquired the Intersect—formerly known as the Washington Mutual Campus—in 2015 and has since carried out complete interior and exterior renovations, adding a restaurant and micro-retail shops that serve grab-n-go coffee, juice and food and snacks. Additionally, the firm has added indoor and outdoor community workspaces, 6,000-square-foot gym, private tenant terraces, 100-seat conference center and 20-person boardroom.
The site also includes a 1,583-space parking garage located at the nearby addressed 17892 Gillette Avenue as well as an underground parking facility with 177 spaces.
A spokesman for New York Life did not immediately respond to a request for comment. A spokesman for Hines was unable to provide comment before press time.