Bank of China provides a $200 million USD loan for the One Wilshire Refinancing Project

Project narrative

On January 31, 2013, the Los Angeles Branch of the Bank of China (BOC) entered into a $200,000,000 USD loan agreement with Hines REIT One Wilshire LP — a Delaware-incorporated special purpose vehicle (SPV) and a wholly-owned subsidiary of Hines REIT Properties, L.P., the Delaware-incorporated operating partnership of Hines Real Estate Investment Trust, Inc., a Maryland-incorporated real estate investor that owns office properties and related real estate (93.841% as general partner), Texas-incorporated Hines Real Estate Holdings Limited Partnership (0.453% as limited partner), and Texas-incorporated HALP Associates Limited Partnership (5.706% as limited partner) — for the One Wilshire Refinancing Project. This loan carried a maturity period of four years and a final maturity date of February 1, 2017, subject to one 12-month extension option and an interest rate of one-month LIBOR plus 2.75%, with monthly interest-only payments. This loan was secured by (i.e. collateralized against) a first priority lien on land, improvements, and other real and personal property, including a mortgage on the One Wilshire building charged by Hines REIT One Wilshire in a deed of trust, security agreement and fixture filing, an assignment of leases, rents, tenant security deposits, and other property in an assignment of leases and rents charged by Hines REIT One Wilshire, and an assignment of project operating agreements, licenses, permits, contracts, and other property in a collateral assignments agreement charged by Hines REIT One Wilshire. The loan contained customary events of default with corresponding grace periods, including payment defaults, cross-defaults to other agreements and bankruptcy-related defaults, and customary covenants, including limitations on the incurrence of debt and granting of liens. The proceeds were used by the borrower to repay and refinance the existing $159.5 million USD loan on the One Wilshire building, an office building in 624 S. Grand Avenue, Los Angeles, California. Then, in July 2013, the borrower sold One Wilshire; it then retired the outstanding principal balance of the BOC mortgage with a prepayment penalty of $2.0 million USD.