Marijuana-Tenanted Warehouses and Dispensary Loans
Montegra Capital is pleased to announce our new program to fund acquisition or cash out refinance first-mortgage-secured loans on Colorado warehouses and dispensaries with marijuana tenants.
- Loans from $500,000 to $3,000,000
- First-position mortgages only
- Loan-to-value (LTV) ratios up to 60%
- Interest rate of 12%
- Loan origination fees from 3% to 4%
- Loan terms from one to three years, with renewal options possible
- Loans for acquisitions and refinances (including cash-out refinancing)
- Personal guarantees required
Because marijuana tenants are willing to pay increasingly higher rent for well-located warehouses with the appropriate tenant finish, there are very attractive opportunities now available for real estate investors to buy properties that produce unusually high net returns. The window for this opportunity may be limited, and lack of bank financing currently makes it difficult for investors to leverage these purchases.
Montegra is a private capital direct lender, not a loan broker. We control the funds and we make the decisions. Montegra is the most reliable source for private capital financing for marijuana-tenanted properties in Colorado. Our principals, Bob Amter and Kim Skari, are available to discuss our marijuana tenanted lending program with you.
- Montegra has a 45-year history of funding commercial private capital loans in Colorado.
- Montegra is a direct lender with full control of funds and the ability to make decisions
- You always deal directly with a principal of Montegra, not a loan committee.
- Loans are underwritten and closed within three to four weeks.
- Montegra offers flexible loan structures to meet each individual borrower’s requirements.
Appraisal Advantages Offered by Montegra
- If our appraiser values your property at a higher value than your purchase contract, Montegra will use the higher appraised value to compute your LTV ratio, unlike banks which use the lower of the purchase price or appraised value. Because Montegra is able to set our own policies, we can choose to use the higher of the two values.
- For example: If you place a warehouse property under contract for $1,000,000 and Montegra’s appraiser values it at $1,250,000, then Montegra can consider a loan of up to 60% of the $1,250,000 valuation, or $750,000. This equals 75% of the purchase price. Montegra does require that borrowers invest at least 25% of their own funds in this type of real estate investment.
- If a borrower intends to add infrastructure to improve the property, then Montegra will consider using the “as completed” appraisal values to determine our LTV ratio. Warehouses with significant tenant finish for marijuana growers command significantly higher lease rates, so if a borrower intends to renovate their property to achieve these higher rents, then Montegra will consider these lease rates in our appraisal. This means that up to 75% of the total cost of the project (including purchase price as well as the costs to renovate) can be financed. The borrower still needs to contribute 25% of the total cost of the project from their own funds.
- When a tenant has a lease with purchase option and the lease-option price is significantly less than current fair market value, Montegra can use the current fair market appraised value to compute our LTV ratio. Therefore, buyers in this scenario who are exercising their option to purchase can obtain higher leverage from Montegra’s lending program. However, Montegra’s final loan amount cannot exceed 60% of the appraised value of the property. Investors who have already purchased a marijuana tenanted property using little or no leverage may find it advantageous to refinance their property at its current appraised value and take cash out. Montegra Capital’s marijuana tenanted property lending program is set up to assist owners in this situation.