Project is located near the intersection of Jefferson and Obama Boulevards.
By Dolores Quintana
JP Morgan and the Ratkovich Company bagged a $41 million loan for their recent purchase of the office space in Culver City at 5950 Bowcroft Street as reported by The Real Deal.com through Torrey Pines Bank.
The loan is a non-recourse loan, which means that the lender would take control of the purchased property in case of a default by the borrowers. While banks have been wary of these types of loans in the current economic climate of high-interest rates and waning property sales, Torrey Pines, a subsidiary of Western Alliance Bank, decided to take the associated risk.
The complex was purchased in October of 2022 for $49.6 million and contains four buildings that JPMorgan and Ratovich intend to redevelop, hoping that the current tech and entertainment boom in Culver City continues since the property is very close to the offices of Amazon, WarnerMedia, Sony among other tech and entertainment companies. The property also sits about a mile away from Apple’s future 536,000 office campus. Micheal Friedman and Cushman and Rob Rubano and Brian Share of Wakefield were the ones who negotiated the deal.
The fact does remain that Culver City’s office vacancy rate is higher than the average in Los Angeles, 26 percent, with a third of all of the city’s office space lying vacant according to Savills.
The loan has a secured overnight financing rate with a low single-digit spread and the SOFR’s rate was 4.31 percent on January 6, 2023. It is considered an “extremely favorable rate” as quoted by The Real Deal.com. However, this was the rate before the Federal Reserve’s recent interest rate hikes