Mesa West Capital has provided Brookfield Asset Management with a nearly $100 million loan to refinance a Washington DC office property that the global asset manager has owned for almost 10 years.
According to a statement from the Los Angeles-based real estate lender, Mesa West furnished Brookfield Real Estate Opportunity Fund I with a $95.5 million first mortgage loan against 64 New York Avenue NE in Washington DC. A spokesman noted that the firm provided the financing on behalf of its Mesa West Real Estate Income Fund II, which closed on $615 million in 2010.
Since acquiring the 355,000-square-foot office building in 2005, Brookfield has made significant capital improvements to the property’s tenant spaces, common areas and building systems. The building currently is 45 percent occupied by various agencies of the District of Columbia, which recently signed a new long-term lease. Brookfield is actively marketing the remaining space.
The loan proceeds were used to refinance the existing debt, as well as provide for capital costs associated with the recent improvements and District of Columbia lease, according to Mesa West principal Raphael Fishbach, who originated the financing. In addition, the loan includes a holdback to fund the costs associated with leasing up the remaining vacancy.
“This investment provides us with an opportunity to make another loan on an institutional-quality building with a long-term credit lease to a sponsor with substantial cash equity invested in the asset,” said Fishbach.
Originally built in 1924 as a warehouse, 64 New York Avenue was converted into a Class A office building in 2000. It is located in the NoMa submarket of Washington, which has seen more than $3 billion of private investment since 2004.