Bank One has named Tom Schnell to head its real estate corporate banking group. Schnell, who previously headed up the bank's real estate syndications group, will now manage a 20-member group focused on a much broader base of capital markets activity including high-yield bonds, derivatives, equity and convertible securities for large public companies and institutional real estate players. He succeeds John McDonald, who retired about two months ago.
Schnell now reports directly to Timothy Hadro, managing director and head of commercial real estate. About two-thirds of the deals done by the syndication group came from the bank's corporate clients, Schnell noted. Marsha Cruzan, who heads all syndications, will be acting as interim head of the real estate syndications group until the spot is filled. Bank One will be looking internally and potentially externally to fill his role, Schnell said.
Meanwhile, Bank One is looking for about 13 participants to round out a $350 million loan to CenterPoint Properties Trust. The three-year unsecured line includes an accordion to $500 million. The existing $350 million line, also led by Bank One, includes an accordion for $400 million.
Pricing has come down about 20 basis points to LIBOR plus 1%, all-in, split between an 80-basis point fee for the line and a 20-basis point facility fee. "The company has strong fundamentals and they have been doing a good job of digesting a large development pipeline from two years ago," the bank official said. "Pricing in general has come down for investment grade REITs," he added, noting that the REIT is rated BBB/Baa2.
Bank One is the sole lead arranger and administrative agent. Documentation and syndication agent titles have been offered at the $35 million tier and are currently being determined. Up-front fees range from 30-50 basis points depending on the commitment, the official said. The current line also includes a 13-member syndicate and the deal was offered to several new lenders to anticipate dropouts. Commitments are due this week and syndication is expected to close late June.