Pacific Life Refinances Durham Mixed-Use Development With $69M Loan
A partnership between Hawthorne Residential Partners and Drake Real Estate Partners has nabbed $69 million in debt to refinance a mixed-use project called University Hill in North Carolina’s Research Triangle, Commercial Observer has learned.
Pacific Life Insurance Company supplied the loan on the art-centric development, which features 269 apartments and 65,500 square feet of retail space at 3806 University Drive in Durham, just a short drive from Duke University, the University of North Carolina at Chapel Hill (UNC) and North Carolina Central University.
Newmark’s Josh Davis, Chris Caison and C.J. Webb advised the borrowers in the negotiation of financing.
“University Hill is a one-of-a-kind asset in the dynamic and fast-growing Durham market in North Carolina’s [Research] Triangle,” Davis said, adding that the market had recently been ranked by Urban Land Institute as one of the best areas in the country for real estate prospects. “The project’s mix of market-leading multifamily units and amenities, combined with a curated mix of some of the most popular local retailers and restaurants, and a permanent, eclectic art installation, drew intense interest from a wide variety of lenders.”
Life companies are generally very selective with what real estate they choose to lend against in today’s market, Webb said. He added that Pacific Life’s “interest in this financing underscores the quality of this project and the strength of the sponsor.”
Pacific Life could not be reached for comment. Representatives for Drake and Hawthorne were not available to respond prior to publication.
Hawthorne started developing University Hill in the summer of 2018, on 15 acres of vacant land situated south of downtown Durham, in between Duke and UNC. Along with its apartments and retail, the property has 40,000 square feet of murals called “UHills Walls,” an art installation featuring works from more than 40 artists. It’s the largest cluster of mural art in the Southeast region, according to Newmark.
University Hills’ retail space includes a 30,000 square foot portion that’s occupied by O2 Fitness studio. Other retailers there include Happy + Hale, Triangle Coffee House and Midtown Yoga. Earlier this year, Raleigh-based Gizmo Brew Works signed on to take 2,000 square feet at University Hill for a new taproom, which would mark its third location in the Research Triangle area; Gizmo is expected to open there next year, according to Newmark. BB’s Crispy Chicken, a restaurant concept from award-winning Raleigh chef Ashley Christensen, is also expected to open at University Hill in 2022.
The property’s residential amenities include saltwater swimming pool; outdoor barbecue areas with two gas grills, as well as two wood-fired pizza ovens and two ceramic charcoal barbecue cookers by Big Green Egg. The residential portion also sports a breakfast and coffee concierge, an indoor herb garden, a game room, a fitness center, a pet playing area and dog spa, indoor bike storage and a car charging station.
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