$1.7M Construction Takeout: Drive-Thru NNN Retail
Kettleman City, CA — Ownership had just finished a $1.28M renovation converting a freestanding retail building into a two-tenant, drive-thru-anchored pad with a new 10-year investment-grade coffee lease. The construction debt matured before the bank could finish permanent underwriting. Helvetica refinanced it at 52% LTV so the borrower kept the asset and the upside.
The Borrower's Problem
Three investors holding title as tenants in common had purchased an aging freestanding retail building and spent roughly $1,283,000 rebuilding it into a modern two-tenant pad — including a new drive-thru window built to a national coffee brand's specification. The work was done, the anchor lease was signed for a 10-year initial term at $170,000 NNN, and a second restaurant tenant had committed to the remaining 1,800 SF.
The problem was timing, not quality. The construction loan used to fund the renovation was coming due, and the conventional bank refinance was still working through committee and third-party reports. A matured construction loan puts a fully leased, newly renovated asset at risk of default no matter how strong the rent roll looks.
The Helvetica Solution
Helvetica funded a $1,700,000 first mortgage against a fresh $3,270,000 appraisal — 52% LTV — retiring the maturing construction debt in full. The loan was written interest-only on a 6-month term with one 6-month extension option available while the loan remained in good standing, giving the borrower up to a year of runway against a bank calendar they did not control.
The structure was deliberately matched to the asset: the anchor tenant's $170,000 annual NNN rent covers the interest-only payment on its own, so the property services the bridge debt without the sponsors funding carry out of pocket. Income from the second tenant sits on top of that.
Benefit to the Borrower
- Maturing construction debt retired before it could become a default
- Ownership of a newly renovated, newly leased asset retained — no forced sale
- Anchor NNN rent alone covers the interest-only payment; no out-of-pocket carry
- Roughly $1.57M of hard-earned renovation equity preserved at 52% LTV
- Six-month extension option removed the pressure of the bank's timeline
- Good — not perfect — credit was not an obstacle to closing
- Second-unit lease-up value accrues to the borrower, not a lender
Deal Highlights
- Renovation and build-to-suit construction takeout
- New 10-year investment-grade drive-thru lease with rent escalations
- Two-tenant net-leased retail pad on a high-traffic highway corridor
- Tenants-in-common ownership including a repeat borrower
- Bridge to conventional bank refinance
Construction loan maturing before your bank takeout?
Helvetica funds bridge and construction takeout loans from $300K–$10M+ on investment and business-purpose real estate, typically closing in 3–10 days following receipt of all requested documentation.
