Funding Purpose
Tauro Capital Advisors, Inc. was engaged on an exclusive basis to place an $18.2 million construction loan for the development of a 1,072-unit self-storage facility in NorCal.
Property Description
The land was bought for $5 million in 2021 and has completed entitlements and permits. Project would be a Class-A, climate-controlled building with 121K SF NRA.
Sponsors
The Sponsor is an experienced developer who has built over 30 storage projects over his career, mainly partnering with Extra Space on his builds.
Challenges
- Lender concerns include cost overruns, cap rate, and self-storage demand.
- Involved in a lawsuit with a nearby airport.
Solutions
- Tauro modeling accounted for a 5% contingency with an exit cap rate at 5% based on the projected increased demand in the asset.
- Case easily settled and dismissed.
Funding
- Loan-To-Cost: 65%
- Interest Rate: SOFR + 2.65%
- Term: 7 Years
- Prepayment: Allowed
- Close Date: 8/1/2024
