First Trust Deed collateralized by an approximately 367,000 square foot mall in Nampa, ID (about 22 miles west of Boise, ID). Current tenants in this mall include national brands such as Big 5 Sporting Goods, Ross Dress for Less, and Jo-Ann Fabric as well as 30+ local tenants. The property is currently operating at a 36% vacancy however retail vacancy for this market is about 10%. Do to the declining consumer appetite for traditional mall space, it is the borrower’s intent to demolish a portion of the mall and turn it into a lifestyle center. To do this, the borrower will demolish approximately 30% of the in-line shop space and remove most of the interior corridors. In addition, the borrower will renegotiate leases with two of the big tenants to move their space as well as increase the duration of their lease. On top of that, the borrower will bring in two big box tenants to absorb a large amount of the vacant space. Given this property has more vacancy than the surrounding properties, it is the borrower’s intent to lease up the remaining space before he puts the property on the market for sale.
Loan Amount: $11,000,000
Yield: 10.5% (Principal Balance ≥ $100,000); 10.0% (Principal Balance < $100,000) Interest is paid monthly in arrears with payments due on the 1st of each month with a 10-day grace period.
Term: Nine months with two optional nine-month extension periods at maturity.