Pearlmark and Waterton Announce the Closing of a $53.2 million Mezzanine Debt Investment with The McBride Cohen Company for Multifamily Development in Tempe, Arizona

Pearlmark, in partnership with Waterton, announced that it closed on a $53.2 million mezzanine debt investment for the development of the first phase of South Pier at Tempe Town Lake ("South Pier"), a fully-entitled waterfront multifamily project on Tempe Town Lake in Tempe, Arizona. The subject project will consist of three towers of 724 luxury multifamily units over an 850-stall parking garage, with 280 stalls of surface parking and 26,500 square feet of ground-floor commercial space.

The McBride Cohen Company ("McBride Cohen"), a preeminent real estate development company, through its owner and CEO Loren McBride Cohen, is leading the development of the project, with The Davis Experience as the project architect and Clayco as the general contractor. Construction on the first phase project began in January 2023 and completion is expected by Spring 2026.

"The closing of this deal significantly boosts our mission of delivering a world-class waterfront destination to the Phoenix Valley," said Loren McBride Cohen, owner and CEO of McBride Cohen. "We are grateful for the confidence Pearlmark has shown in our vision for this historic project."

McBride Cohen is the master developer of South Pier at Tempe Town Lake, a resort-inspired seven-phase project that spans 18 acres and 3.2 million square feet, along nearly one mile of the southern shoreline of Tempe Town Lake. The site is directly adjacent to the main campus of Arizona State University with its 85,000 students. The multibillion-dollar mixed-use project will transform the Tempe Town Lake into a bustling waterfront neighborhood, with 24/7 uses across its 18 total buildings, which will be constructed in phases over the next 8-12 years. Future phases will include thousands of additional housing units, more than 600,000 square feet of high-rise Class-A office space, two luxury hotels, as well as the iconic South Pier Isle, a world class entertainment district providing dining, shopping and nightlife experiences and featuring restaurants, cafes, nightlife venues and live-event spaces, world class fountain shows, and the Arizona Amazing Wheel – an 80-meter-tall observation wheel. The project site is located within an IRS designated Qualified Opportunity Zone, and at its completion will be one of the largest master-planned projects in the United States, creating a luxury, mixed-use waterfront entertainment destination in the ever-growing Phoenix Valley metropolitan area.

The mezzanine loan was originated by Pearlmark on behalf of Pearlmark Mezzanine Realty Partners V, L.P. and a commingled investment vehicle managed by Waterton. Banco Inbursa, a Mexico City-based bank founded by prominent international investor Carlos Slim, provided the senior financing loan, while Cantor Silverstein Opportunity Zone Trust, Inc., a joint venture with Silverstein Properties and Cantor Fitzgerald, and McBride Cohen, funded all equity required of the project's first phase. Jones Lang LaSalle, led by Seattle office co-head Tom Wilson, advised the project sponsors on this capitalization.

Bill Swackhamer, Managing Director of Pearlmark, arranged the transaction for Pearlmark and Waterton. Mr. Swackhamer commented, "South Pier at Tempe Town Lake is a great monument to the South Pier master development, and we are excited to be involved given the sponsorship and quality of the project – and pleased to be completing our first funding in partnership with Waterton."

Julie Heigel, Vice President, Acquisitions of Waterton remarked "We are excited to work with this experienced sponsorship group and diversify our investment portfolio. It has been great to partner on this deal with Pearlmark and help bring this expansive project to life."

Doug Lyons, Managing Principal and Head of Debt Investments for Pearlmark, further commented, "The experience and significant capital commitments of McBride Cohen, Silverstein, and Cantor Fitzgerald provided Pearlmark and Waterton a high level of confidence in this complex, large-scale luxury multifamily housing development."