Mesa West Capital has originated two loans totaling $60.6m out of its recently opened Chicago, Illinois offices for the purchase of a nine-building apartment community and a four-building office portfolio, Real Estate Capital has learned.
A $44.1m, five-year, non-recourse first mortgage loan backs investment firm CLK Properties’ acquisition of nine pre-war walk-up apartment buildings on the east side of Chicago’s Lakeview submarket.
Woodbury, New York-based CLK will use a portion of the loan proceeds to renovate each of the community’s 175 studio, one-, two- and three-bedroom apartments, rebranding the community under the name Elaine Place and aiming to capture higher rents.
The properties are within walking distance to Lake Michigan, the Wrigleyville neighborhood and Wrigley Field, home to the Chicago Cubs baseball team.
“These are vintage buildings located in one of Chicago’s most desirable neighborhoods,” said Mesa West Principal Ronnie Gul, who led the financing. “Lakeview is one of the strongest rental markets in Chicago and continues to experience excellent occupancy and rent growth.”
A separate $16.5m, five-year, non-recourse loan to a joint venture between CLK and RCG Longview backs the acquisition and stabilization of four low-rise mixed-use buildings in the Fulton Market District of Chicago’s West Loop neighborhood.
The office buildings, totaling 86,755 sq ft, were 64 percent occupied at closing, but Gul noted that the rent toll is currently comprised of “very small, short-term leases at below market rents.”
“Our financing will allow the new ownership to leverage rapidly improving market fundamentals and lease the space to creative and tech users, as well as retailers that are being drawn to the area,” he said.
Mesa West opened the new regional office late last month to support its increasing lending activities in Chicago and throughout the Midwest, hiring former Wells Fargo Bank executive Matthew Snyder at the helm. The firm has completed more than $348m of loan originations in the Chicagoland area in the past six months.
Sal Torre at Estreich & Company arranged both financings.