Gantry, the largest independent commercial mortgage banking firm in the western United States, has structured and secured $325 million of development funding for a 41-story mixed-use multifamily and hotel tower located in the Belltown submarket of downtown Seattle. The project financing includes a $225 million joint-venture partnership and a $100 million construction-to-permanent loan to develop the as yet-to-be-named property, formerly known as Potala Tower.

“This was an extremely complex capital stack and deal structure with many moving parts. The project faced numerous hurdles, including salvaging the principal of original investors who are now represented by the new joint venture.  Gantry has decades of experience in arranging complex financing and creating joint ventures for institutional investors, and we applied that experience and stewardship to resurrecting this unique project. We had a talented and dedicated team of people involved in making this transaction a reality.”

-George Mitsanas, Principal of Gantry

Due to circumstances concerning the original developer of the project, the project was put under the control of a court-appointed receiver and construction was suspended on the project for approximately one year. The joint-venture development partnership, arranged by Gantry, acquired the property from the court-appointed receiver in October 2016. Construction has resumed at the project and is now underway, with Denver, CO-based PCL as the general contractor and project design from Seattle’s Weber Thompson architects. The tower will feature 339 apartment units, 142 hotel rooms, and 1,824 SF of ground floor retail space. The project is designed to meet the LEED silver certification standard and is expected to be completed by August 2018.

The Gantry team was led by George Mitsanas, Principal, Peter Hillakas, Vice President, and Doug Tisdale, Associate, from Gantry’s Los Angeles office. Joining them in completing this transaction was Mike Taylor, Principal, and Patrick Taylor, Associate, from Gantry’s Seattle office. The $100 million construction-to-permanent loan was placed with two of Gantry’s correspondent life insurance company lenders on a pari-passu basis with each lender providing $50 million in financing.  The 7-year construction-to-permanent loans will be interest-only for a period of time and later amortized over 30 years. Both loans will be serviced by Gantry.

“Both our development team, lending group, and all third-party professionals involved were fantastic companies and people to deal with throughout the process. A first-class group of professionals! This project will also be a significant job creator both during construction and once completed,” said George.