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InPoint Commercial Real Estate Income Originates Mezzanine Loan to Purchase Office Portfolio

InPoint Commercial Real Estate Income Inc., a non-traded commercial mortgage real estate investment trust, has originated a $7.5 million mezzanine loan for the acquisition of three Class A office buildings totaling 306,534 square feet located in Hopewell Township, New Jersey. The REIT is advised by an affiliate of Inland Real Estate Investment Corporation and subadvised by a Sound Point Capital Management affiliate.

The New Jersey property was purchased for $73.6 million and financed with a $51.4 million first mortgage loan from an unaffiliated lender, the $7.5 million mezzanine loan originated by InPoint, and $15.6 million of equity capital.

According to a filing with the Securities and Exchange Commission, the mezzanine loan is a 10-year, fixed-rate, interest-only loan which bears interest at a rate of 9.20 percent.

“InPoint’s origination focused investment strategy, combined with the Sound Point team’s deep origination relationships, provides an opportunity for InPoint to make loans backed by high quality properties owned by experienced managers,” said Don MacKinnon, president of InPoint and portfolio manager for InPoint’s sub-advisor.

The property is situated 10 miles from downtown Princeton, New Jersey and is part of the Hopewell Corporate Campus, which consists of 12 Class A office buildings totaling approximately 1.8 million square feet. It is 100 percent leased to five tenants with an average lease term of approximately 13 years.

InPoint Commercial Real Estate Income seeks to originate, acquire and manage a diversified credit portfolio secured by commercial real estate properties primarily within the United States.

As of August 9, 2017, the company raised $23.6 million in investor equity since commencing its $500 million ongoing private offering in October 2016. The company’s portfolio consisted of two commercial mortgage-backed securities investments with a fair value of $10.6 million, as of the second quarter of 2017.

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