Richmond Redevelopment Project - Canal Crossing, Receives Permanent Financing

Richmond, VA, October 12, 2004 --- Richmond-based John B. Levy & Company, Inc. is pleased to announce the completion of financing for Canal Crossing, an adaptive reuse project in the heart of Richmond. This Class A Office building includes 101,876 net rental square feet. The Building is located on 15th St., between Cary and Dock Streets.

The transaction, a $13,000,000, 10-year fixed rate permanent financing, takes out a construction and mezzanine loan. The structure was complicated by historic tax credits as well as leasing reserves and holdbacks. In 2002, John B. Levy & Company arranged for $10,000,000 in non-recourse construction financing, when the building was only 30% pre-leased – unheard of for this market.

“This project is exceptionally well located and has a strong mix of local office tenants and retail uses; the renovation is estimated at close to $17,000,000 in value,” said John B. Levy, president, John B. Levy & Company. “We were able to arrange immediate financing, in part due to strength of the building profile, and its location – with good access from the city’s main arterial roads, (I–95, I-195 and Hull Street) and tremendous visibility. Its location right on the canal is adjacent to one of Richmond’s main tourist attractions, and significant pedestrian traffic – and the lender realized these as an asset,” said Levy.

Canal Crossing “Tower” and “Annex” are an adaptive reuse of a mid-rise warehouse and a tobacco curing facility constructed in phases between 1916 and 1948 and entirely renovated in 2003/2004. The combined buildings contain approximately 101,876 net rentable square feet of office and retail space.

The Canal Crossing “Annex” was constructed in 1948 for Philip Morris as a two-story tobacco curing facility. Both floors in this building have a well-lit open design with 29,000 square foot floor plates. The second floor features beautifully restored original maple floorboards.

The Canal Crossing “Tower” originally constructed in 1916, was a mid-rise five-story concrete-frame tower designed to warehouse groceries. This building was later converted to a cannery and then to an annex for the Philip Morris tobacco facility. The floor plates in this structure are designed with close to 10,000 square feet rentable per floor.

Major tenants include Baskervill & Sons, PC a large Richmond based architectural design firm, BrownGreer, PLC a local law firm, and several retail uses including Buffalo Wild Wings, a New York style wings and sports bar, recently notes as one of the top 10 fastest growing restaurant chains in America. “Our lender was comfortable with the developer, the final product and the tenant mix,” said Levy.

John B. Levy & Company, Inc. is a real estate investment-banking firm founded in 1995 and headquartered in Richmond, Virginia. The firm raises equity or debt for developers and owners of commercial and multi-family projects nationwide. The firm has structured over $1 billion in financing. Despite a tumultuous economic environment over the past 90 days, the firm has successfully closed a number of transactions, each with its own property specific challenges. Representative transactions include: $52,000,000 in acquisition financing for 600,000 square feet of office space in Prince George’s County, MD; $43,000,000 in financing for CSC’s headquarters building in Maryland; $120 million in re-financing for a cluster of office buildings in the Mid-Atlantic region; and a $7.4 million acquisition/ rehab loan for a multifamily project in Durham, North Carolina (closed in 20 days).