Cohen Financial Secures $152 Million in Financing for 42 Properties

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Chicago-based Cohen Financial announced it has secured $152 million in debt refinancing for 42 free-standing Walgreens drug store properties-part of the Deerfield, Illinois-based Walgreen Co. drugstore chain-located in major metropolitan areas across the country.

The Walgreens portfolio of 42 properties consists of a total of 621,473 square feet. Terms of the loan include an 80 percent loan-to-value (LTV) on a non-recourse, 10-year, interest-only loan. The lender is a correspondent of Cohen Financial.

To mitigate interest-rate volatility through the due-diligence period, Cohen Financial provided the borrower an interest-rate lock agreement for the $152 million debt refinancing with a corresponding yield-maintenance hedge rate-lock agreement on the $130 million existing loan balance, according to Joel Simmons, a partner in Cohen Financial's Skokie, Illinois, office.

"The loan closed 60 days after the interest-rate locks were executed," added Simmons. "During that time, Treasury rates had fallen almost 30 basis points. The increased yield-maintenance costs associated with this rate slide would have eroded the whole purpose of the refinance. …