Thorofare Capital has funded a $13,000,000 floating rate commercial mortgage for the acquisition and repositioning of The Clift Building, a historic office building on the corner of 300 South and Main Street in the Salt Lake City CBD. Located at one of the highest profile corners with some of the best restaurants and amenities within immediate walking distance, 10 West Broadway is positioned to benefit from its ideal location for millennials and progressive companies with the TRAX (light rail) stop just a few steps away. The sponsor plans to remodel the common areas and reposition the property as a landmark building for creative/tech influenced tenants, driven by the expanding tech sector that consists of a mix between home-grown startups and out-of-state relocations.

The sponsor sought certainty of execution in order to acquire the property, in an “off-market” transaction, under an expedited escrow timeline. Thorofare was able to create a highly structured bridge loan with holdbacks and reserves for CapEx, TI’s & LC’s and quickly underwrote the repositioning plan in order to fund in less than a month from application.

The Clift Building is a 1919-built, 98,070 SF, nine-story urban office building situated on a 0.31 acre site. In addition to the office tenants, there are three retail tenants occupying the ground floor. At the time of closing, the property was nearly 95% leased to over 60 small tenants that are on month to month or short term leases at well below the current market rates. Small tenants will be removed floor by floor as the sponsor remodels the interiors and restores the exposed brick and ceilings, thereby NOI may decline during the renovation. Rather than basing proceeds off historical cash flow, Thorofare sized its loan to the stabilized debt yield by underwriting the market rents and occupancy for creative office space.

The sponsor is a Salt Lake City-based private real estate investment firm specializing in urban, infill re-development projects with a focus on adaptive reuse and value-add creative office. The sponsor will handle property management in-house and retained JLL for leasing and marketing.