NorthStar Real Estate Income II Originates $21.6 Million 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), originated a $21.6 million senior mortgage loan secured by a 116,998 square foot retail property located in Colton, California.

The unnamed borrower is an affiliate of a Los Angeles-based real estate investor, and plans to invest an additional $1.96 million over the term of the loan in capital expenditures, tenant improvements and leasing commissions.

The property is located in the densely populated Inland Empire metropolitan area and within the retail corridor of Colton, in close proximity to primary interstate highways, and is also occupied by a diverse array of national and local retailers.

The senior loan, which bears interest at a floating rate of 5.85 percent over the one-month LIBOR, was originated at a 1 percent discount and NorthStar Income II will earn an exit fee equal to 1 percent of the outstanding principal balance at the time of repayment. The loan is currently unlevered and NorthStar Income II intends to finance the senior loan with one of its credit facilities in the future.

The initial loan term is 24 months, with one 12-month extension option available, and a loan-to-value ratio of approximately 70.1 percent.

NorthStar Real Estate Income II invests in commercial real estate debt, select equity and securities investments predominantly in the United States. The company commenced its initial public offering in May 2013 and has raised $1 billion in investor equity. The offering the was recently extended to November 2016.

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