Mid Atlantic Real Estate Journal — October 11 - 24, 2013 — 13A


F inancial D igest

onkers,NY — Mark Scott’s Commercial Mortgage Capital For 178,150 s/f office and industrial building within the iPark Hudson Business Park Mark Scott’s Commercial Mortgage Capital secures $23.25m first mortgage loan Y for a 178,150 s/f office and industrial building located in Downtown Yonkers. The four- newly renovated buildings, which includes a newly con- structed 300-space parking facility.

• Refinance the new property after the exchange in order to replace money sourced else- where All of the options come at a cost, some higher than other, that have to be factored into the ROI calculation as described above. However, except for 3rd-party bridge financing, the cost is likely to continue to be less than the CAP rate on the new property and the arbitrage on the interim cash needed to acquire in a reverse exchange continues to be attractive. To reiterate, finding the optimal solution is the goal and making these calculations is a critical part of deciding which strategy is best. In conclusion, ROI on in- vested capital goes to virtually zero during a forward exchange because the QI is required to hold the cash equity and there are few, if any, rational “investment” vehicles for that cash that earn more than 1% for the QI. Since QIs are often compensated with “marketing fees” rather than real yield on funds, they are retaining most of the earnings on the cash for themselves. For a reverse exchange, when the Investor has the ability to acquire the replacement property before selling the relinquished property, the in- vestor keeps both burdens and benefits of BOTH properties until the relinquished property is sold. This usually results in two sources of rent and two loans to service but, given today’s CAP rates and interest rates, this will nearly always result in positive net monthly income and a ROI picture that is always superior to that of a forward exchange. While many potential inves- tors simply have no way to assemble the funds required to acquire the Replacement Property first, many do indeed have the resources and the re- verse exchange option is often financially compelling. Stan Freeman is presi- dent of Exchange Strategies Corporation. n continued from page 12A The Optimal Exchange . . . (CMC) announced that it recently closed a $23.25- million first mortgage loan

story build- ing is located within the iPark Hud- son Business Park, which is a 97.7%- occupied, 24- acre technol-

As part of the overall iPark Hudson Business Park, the City of Yonkers invested $25 million toward the redevel- opment of Van Der Donck Park, otherwise known as the Daylighting project, which was completed and opened in September 2012. The Van Der Donck Park project created a riverfront walkway running along the Saw Mill River and Larkin Plaza. n

Mark Scott

ogy and office campus. Lo- cated directly by the Yonkers Train Station, iPark Hudson contains nearly 800,000 s/f of space allocated across eight

178,150 s/f office and industrial building located in Yonkers

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