This was a purchase transaction. We had financed this property a few years back for a client who was referred to us. Unfortunately he had passed away and now the property was with an assigned fiduciary and being sold. We once again were referred to this new buyer from the agents.
As we got started on the new transaction we soon learned that our past client had been very sick and as a result the management of this building wasn't priority and therefore the building was over 65% vacant and had some necessary capital improvements that were needed. To top it off we were in the thick of the Coronavirus pandemic and lenders were running from financing commercial properties.
It was difficult finding a lender because of the vacancies, and the current market condition. We went back to the lender who was holding the first trust deed for the seller and were able to negotiate for a short term bridge loan at about 70% loan to cost. The lender allowed for the financing of 100% of the buyers planned renovation budget. This worked out well for the client it allowed him to close the transaction giving him time to do the required work, focus on stabilizing the rents so that he can refinance out or sell if they wanted.