Mobile Infrastructure Secures $75.5M Financing to Bolster Portfolio Stability

The CMBS loan offers long-term fixed-rate financing, enabling repayment of prior debts and refinancing assets.

December 12, 2024

Mobile Infrastructure Finalizes Significant Financing Deal

Mobile Infrastructure Corporation has secured a $75.5 million commercial mortgage-backed securities (CMBS) loan in partnership with Argentic Real Estate Finance 2 LLC. This strategic financial arrangement involves seven subsidiary entities under the corporation, collectively termed the Loan Borrowers, and marks a decisive step to stabilize and optimize the company’s debt structure.

The proceeds from the CMBS loan, finalized on December 6, 2024, were allocated to discharge an existing revolving credit facility with KeyBank National Association and KeyBank Capital Markets. Furthermore, the funding facilitated the refinancing of a property-level loan, strengthening the company’s financial footing and enabling operational efficiency.

Key Financial Details and Loan Structure

The newly secured financing carries an annual fixed interest rate of 7.755%, offering predictability and stability in debt servicing. The maturity period for the loan extends to December 6, 2034, with monthly payments structured based on a 35-year amortization schedule. Full repayment of the principal is due upon the maturity date.

The CMBS loan is secured against first-priority claims on mortgages, leases, rents, and security interests tied to personal property, including accounts, escrows, and reserves. These terms underscore the robust backing and comprehensive nature of the financial arrangement.

Guaranty Agreement and Financial Health

In conjunction with the loan agreement, a limited recourse guaranty was executed by Mobile Infra Operating Company, LLC, serving as the non-recourse guarantor for the CMBS loan. The guaranty mandates the maintenance of a net worth exceeding $40 million, emphasizing the strong financial posture required to support such an obligation.

This financial move signifies a commitment to leveraging structured, long-term debt solutions to manage existing liabilities and create capacity for future growth. By refinancing previous obligations, the company has likely reduced short-term debt pressures while locking in favorable terms over the next decade.

Operational and Strategic Implications

This financing aligns with Mobile Infrastructure Corporation’s strategic priorities, including optimizing its real estate portfolio, stabilizing financial performance, and enhancing shareholder value. The ability to defease the loan after December 6, 2027, or two years post-securitization, further adds flexibility to the agreement, allowing for potential adjustments in response to market conditions.

The company has also reiterated its commitment to transparency and compliance, as reflected in the robust reporting of this transaction in the recently filed SEC documentation.