LDK Ventures arranges commercial mortgage securities; plans further expansion at McLellan Business Park

mclellan park
One of the current buildings at McLellan Park (Image from the business park's website_

LDK Ventures has arranged for $358 million in commercial mortgage-backed securities (CMBS) debt from Goldman Sachs in order to refinance its mixed-use McClellan Business Park in Sacramento, the Commercial Observer (CO) has reported, citing to ratings agency analysis of the transaction.

The financing took out about $344.2 million in existing debt on the asset, a 6.9-million-sq. ft.  complex occupied by more than 175 office, residential, retail and industrial tenants, including its newest tenant, Amazon, according to Fitch Ratings. The loan also covered upfront reserves and closing costs, and Sacramento-based LDK, the sponsor in this deal, and its partners were able to recapture nearly $11 million in cash equity with the refinancing, which closed on Nov. 13.

LDK is partnering with MBP Ventures and Industrial Realty Group at the business park, Park, previously McClellan Air Force Base.

The site includes more than 3,000 acres about 12 miles northeast of Sacramento with 83 industrial buildings, 37 office buildings, 11 retail buildings and seven residential buildings.  Amazon is the largest tenant, occupying about 6 percent of leasable space.

In late March, the Sacramento Business Journal reported that a permit application had been filed in Sacramento County to deploy about $5.5 million in tenant improvements to outfit about 420,000 sq. ft. worth of warehouse, distribution and office and administrative space in a single building to likely fit Amazon’s Ultra-Fast Fresh grocery delivery service — that name of the application was Fast Track Amazon UFF Tenant Improvement. A portion of the work in the application detailed converting a section of the property to cold storage space.

CO reports that  600 additional acres on the site could be developed. “LDK has already built out three new projects at the park, including the new Amazon development, and they’ve recently moved to further expand the site’s square footage, having just filed plans to add a bundle of new logistics facilities,” the publication reported.

Earlier in November, Sacramento Business Journal reported that LDK was planning to erect three new, one-story warehouse and distribution buildings on 24-acres, spanning nearly 418,000 sq. ft. and will separately be called McClellan Logistics Center. Plans also call for 446 parking spaces for site employees and 62 truck trailers. Construction should begin next spring, and occupancy should begin by the end of next year.


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