Hackensack, NJ, August 11, 2008 – In an economic environment where borrowers face increasing difficulty obtaining working capital from traditional lenders, Hackensack-based Kennedy Funding, Inc., closed three loans totaling over $27 million in two days. The direct lending organization, well known for expediency in issuing commitments and closing, provided funds to an Arizona mixed-use developer for a major retail/office center, to a publicly traded commercial building and management company in the Los Angeles area, and to a New York developer for residential build-outs.
The $11.5 million Arizona loan went to National Retail Development Partners (NRDP), for site development and construction of Ironwood Festival in prestigious Scottsdale. The complex will comprise 81,000 sq. ft. of retail space and over 31,000 sq. feet of offices in one of the Southwest’s fastest-growing areas. According to NRDP principals, the company was looking to close a transaction quickly to honor a purchasing contract on deadline and to move ahead with plans for putting up buildings to fit the Arizona landscape.
The almost-14-acre undisturbed site served as NRDP’s collateral. The site promises strong return on investment. Completion is slated for next year, surrounding roads and traffic signals are in place and a national pharmacy chain, a major financial institution, and supermarket already have indicated commitment.
True to Kennedy’s reputation for closing quickly, the transaction was accomplished in just 14 days. According to Trent Schelkopf, president of NRDP, Kennedy “met our realistic expectations. They moved along the time line that was promised and we will be more than willing to work with them in the future.”
MerueloMaddux (NASDAQ-MMPI), the Los Angeles area’s largest owner of industrial property including some of the state’s well known produce centers, received $8.8 million from Kennedy to take advantage of a commercial building opportunity. In just two weeks from start-to-finish, the loan fulfilled MerueloMaddux’s twofold parameter – good working terms and a fast closing.
Like many Kennedy clients, MerueloMaddux came to Kennedy via a broker, Marcus & Millichap Real Estate Investment Services, whose vice president Adam Petriella praised Kennedy’s “fine-tuned, responsive, and efficient approach to the process” which gave his client another “opportunity to continue its strong presence in the Los Angeles real estate environment.”
The third loan, $7.05 million, went to the New York development company Bownetree, LLC’s Sam Suzuki to complete interior structures of two-bedroom apartments in five attached rental buildings in a Flushing, Queens, neighborhood where the residential and retail population continues to grow. Near completion, the buildings represent solid value and a stable lending risk, according to Jeffrey Wolfer, president and Co-CEO of Kennedy Funding.
“All these borrowers are strong clients,” says Wolfer, “and they represent an interesting diversity in geography as well as project concept, as do all our clients. The fact that we closed three loans in a two-day period is a major accomplishment in the current market.” Wolfer points out that two months ago Kennedy closed on a record four loans in one day, totaling almost $40 million.
“Whatever the project,” Wolfer continues, “some criteria remain the same for virtually all borrowers who come to Kennedy. They want an application process without red tape, they want a strong comfort level with loan terms, they want to be able to communicate easily with Kennedy, and they want to close quickly. With traditional lenders closing the door on even their most regular borrowers, direct lending is the way to go and Kennedy is able to step in and fulfill these criteria. The diverse approaches of these borrowers and our ability to close on these loans quickly demonstrate the flexible and comprehensive approach we take toward applicants. By putting our confidence in these borrowers we’re putting our confidence in the ultimate growth of the economy.”
Kennedy Funding is no stranger to taking risks on borrowers that other institutions turn away. The company’s evaluation process – seamless from initial application through loan closing – often results in closing in as few as five days and most often not more than two weeks. An extensive fund source spurs loans from $1 million to as high as $100 million, generally with up to 65% loan-to-value for commercial land development, acquisitions, workouts, refinancing, bankruptcies, and foreclosures.
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