NorthStar Income II Purchases Senior Mortgage Loan

NorthStar Real Estate Income II Inc., a publicly registered, non-traded real estate investment trust sponsored by NorthStar Asset Management Group Inc. (NYSE: NSAM), purchased a senior mortgage loan with a total commitment of up to $21.1 million for $16.9 million, representing 93 percent of the current outstanding principal amount of $18.2 million.

The loan is secured by a 59,000-square-foot retail property in San Diego, California that is occupied by a mix of national and local retailers. Over the term of the loan, $3.0 million (approximately $50 per square foot) from future funding commitments is planned for capital expenditures, tenant improvements and leasing commissions.

The borrower is an affiliate of an experienced developer, owner and operator of retail commercial real estate with more than 30 years of experience.

“The purchase of this debt investment at a significant discount to the original loan amount demonstrates our sponsor’s discipline in its investment approach,” said Daniel R. Gilbert, chief executive officer and president. “NorthStar invests shareholders’ capital based on the results of our proven underwriting process and not by market pressures. Our ability to opportunistically capitalize on strong risk/return investments provides NorthStar with a diverse pipeline of opportunities across our target asset classes from a variety of sources.”

NorthStar Income II was formed to originate, acquire and manage a diversified portfolio of commercial real estate debt, select equity and securities investments. As of February 5, 2016, the REIT’s $1.5 billion portfolio consists of 18 senior mortgage loans, two real estate equity investment portfolios, three subordinate interest investments, two portfolios of real estate private equity funds and three commercial mortgage-backed securities investments.

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