Reprinted from: Commercial Mortgage Alert Pg. 4
April 18, 2003
Travelers Insurance has originated a $65 million mortgage on a Florida office complex controlled by T-Rex Capital. The floating-rate loan is backed by the 1.8 million square-foot T-Rex Corporate Center at Boca Raton. Travelers will keep the loan on its books.
T-Rex, an opportunistic real estate investment firm headed by Thomas Mulroy, leads a partnership that bought the property three years ago with floating-rate financing from Lehman Brothers — a $100 million first mortgage and a mezzanine loan whose size is not known. T-Rex used the Travelers loan to pay off the $65 million balance on the first mortgage. Lehman continues to hold the mezzanine loan.
IBM built the complex in 1967 as one of its main campuses. The first IBM personal computer was designed and manufactured there, as was the company’s OS/2 operating software. In 1988, IBM refitted the complex into a high-tech development center with laboratories and testing chambers. But IBM vacated the 550-acre site and sold it in 1997 for $46 million to a partnership led by Boca Raton developers Ned Siegal and Morris “Skip” Stoltz 2d.
The T-Rex group bought the complex and adjacent land in 2000 for $140 million. It has spent more than $20 million on physical upgrades and is in the process of reworking the tenant roster. The complex is now 70% occupied by, among others, Siemens, the U.S. Postal Service, ChoicePoint and Alamo Rent-a-Car. The partnership also sold most of the adjacent land and used $35 million of the proceeds to pay down the mortgage. Today, the complex is worth between $160 million and $180 million.