Gantry, the largest independent commercial mortgage banking firm in the U.S., has secured a $40 million permanent loan to retire maturing debt on two cross-collateralized industrial buildings in active Los Angeles industrial submarkets. Both recent vintage buildings are 100% occupied with different single tenant occupiers.

The first property, located at 5370 Boyle Avenue in Vernon, is a 203,000 square-foot industrial building occupied by PODS in the key Mid Cities industrial submarket The second property, located at 10445 Glenoaks Blvd in Pacoima, is a 95,000-square-foot building used as asound stage facility as part of the Quixote studios campus. Both assets are well positioned to serve as last-mile logistics facilities in these supply-constrained, demand rich environment if re-tenanting is ever necessary.

Gantry’s George Mitsanas, Principal, Bahman Mirhashemi, Senior Director, and Keegan Bridges, Associate, with the firm’s Los Angeles production office represented the borrower, a privately held real estate joint venture managed by Xebec, a private real estate investor. The five-year, fixed rate loan was secured from an insurance company lender and features full-term interest only.

“This financing reflects our ability to consistently execute on high-quality industrial investments while securing favorable, institutional financing that supports long-term value creation,” said, [Jay Soni, President of Xebec].

According to Gantry’s George Mitsanas, “Insurance companies remain a highly competitive source for attractive loan outcomes on high-quality industrial property in the current cycle. For these recent vintage assets, qualifying in place rents at below market rates allowed us to align maximized loan proceeds with full-term interest only covenants to enhance cash flows. This is because both assets are uniquely positioned if necessary for a transition to a last-mile logistics use in a competitive market for modern buildings. While single tenant occupancy can often be a challenge when financing shorter remaining lease terms, many insurance lenders will also underwrite permanent loans to reflect market fundamentals and future rent growth potential when determining asset value in ‘senior stretch’ structures offering enhanced terms above current performance.”