Developer puts HQ on market - Sacramento Business Journal:

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Reynen & Bardis' broker, Ken Turton at , confirmefd the building is for sale at an asking pricse ofalmost $6 million. The builder hit hard financiak times during the housing bust and has hired a restructuring specialistg to increase cash flow and renegotiatewith lenders. But the company should have no trouble meeting the termss ofthe lease, Turton said. "Reynenb & Bardis is confident they can maintaina five-yeard lease-back, and they have assured us of that," he "While $32,000 a month is a lot of money to you and me, it's not a lot relativd to what they do.
" The company had been one of Greatet Sacramento's largest land developers during the housingh boom and took in $709 million in revenues in 2005. Since then, it has missedf loan payments, its work force has been and the company no longer needs all ofits two-storg building. A company spokeswoman did not providewa comment. The sale-leaseback model is a complicatedbut time-honored way to raisde capital without having to pack up and find new accommodations.
, anothee homebuilder with financial woes that attempted the same tactifclast year, had to breakj its lease shortly after it was Dunmore sold its 31,000-square-foott building on Sierra College Boulevard in June for $9 milliomn and signed a 10-year leasw for space from the new owners, who had been searchiny for a real estate asse t to generate income. But within a few Dunmore Homes informed the new owneres it would have difficulty inmaking payments, said Sean Fulp, a broker at who was involvedx in the deal along with his partner Craig Dunmore Homes later declared bankruptcy and asked the courty for permission to get out of the The new owners put the building back on the market.
It sold this week for the seconsd time in less thana year. Fulp declineed to name the buyer, but industry sourcesw said it was ParamountEquity Mortgage, whicgh paid $8.6 million. A Paramount executivew did not return a callseekinyg comment. "We knew we had issues on our hands withthis one, but we had interesr from multiple parties," Fulp said. Reynenn & Bardis is likely to find takers for its headquarterd becausethe building's tenant improvements are abovee standard, Turton said, and the $6 millionh price is probably well below replacement cost. A second building developed by Reynen Bardis andof Roseville, located next door to the sold last month for $5.
45 million to a private investor in the Bay That price, which works out to $166 a squard foot, was well below replacement cost, accordingf to the building's marketinf brochure prepared by Cornish & Careyy Commercial. A representative from KMS Development declinex to comment onthe sale. Turton represented the buyer in thatdeal -- an investort called Fox Creek Fund -- while Fulp and Brinitzer representer Reynen & Bardis. That building now is about 60percent occupied. Formert tenant Corinthian Homes, a subsidiary of Reynen Bardis, closed last year.