ValueXpress has arranged a $6-million first mortgage CMBS conduit loan for the refinance of two adjacent retail buildings located in Henderson, Nevada. Henderson is a rapidly growing suburb of Las Vegas that is located approximately 10 miles southeast of the city. The purpose of the loan was to obtain a ten-year, fixed-rate loan term on a non-recourse basis to replace an existing construction loan and return cash equity to the property owner.
The sponsors just completed construction of the two buildings and leased the property to Speedee Mart and Rounder’s Grilling and Gaming Company (https://www.rounderslv.com), a neighborhood bar and grill where diners can enjoy gaming such as poker, keno and slots while enjoying food and drink. Speedee Mart is a local convenience store chain with 23 locations surrounding Las Vegas. The stores feature gasoline and a car wash in addition to typical convenience items.
“There were many challenges on this deal. First, convenience stores with gasoline sales and restaurants are not typically found in CMBS when the rent from these tenants is such a high proportion (approximately 50% for each) of the total income of the property,” said Michael Sneden, Executive Vice President at ValueXpress, who originated the loan for ValueXpress. “The CMBS market wants to see convenience stores and restaurants be no more than 20% of the total rental income.”
“In addition, the loan amount on a per-square-foot basis was very high. We needed to prove out the value per square foot, which we were able to do successfully. Our familiarity with the market allowed us to demonstrate the tremendous growth and potential of the city of Henderson. The market boasts a plethora of Class A industrial, multifamily and retail projects, including land that was purchased for the purpose of building the new NFL Raiders football training facility and team headquarters. After spending many hours researching the market, we convinced credit on the merits of the loan and got it approved.”