A Big Construction Loan

Commercial real estate financing has yet to come in from the cold caused by higher interest rates and inflation (and the general economic uncertainty these factors have wrought). Every now and then, though, along comes a loan that proves there is still dry powder out there. The latest? A $325 million construction deal in the Los Angeles area. Plus, proptech startups are raising less out of the gate and infrequently so to boot.

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— Tom Acitelli, Co-Deputy Editor

Related Gets $385M Construction Loan for Mixed-Use Project in Santa Monica

Related California is set to launch its next major mixed-use development in Southern California thanks to new construction financing from Bank of America. The West Coast affiliate of Related Cos. announced Monday it secured $385 million for the project named 710 Broadway, set to rise in Downtown Santa Monica near the intersection of Lincoln Boulevard and Broadway. It calls for 280 apartments, a 30,000-square-foot private park, 35,000 square feet of retail space, and a 55,000-square-foot Vons supermarket. The Large Architecture-designed development is set to break ground next month and finish construction in the fourth quarter of 2025.

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Proptech Seed Rounds Shift in Frequency and Amount

In the realm of risky business propositions, investing in proptech startup seed rounds might be compared to playing roulette. The odds of success are low, but the payoff on a winning bet can be too enticing to pass up. Despite the odds, as well as the current macroeconomic instability caused by high inflation and interest rates combined with a confusing jobs market, proptech-focused venture capitalists are not shying away from placing their bets on seed rounds — albeit with more stringent rules attached, experts say. “Seed rounds overall had been holding pretty steady through 2022 and 2023,” said Zak Schwarzman, general partner at MetaProp, a Manhattan-based, early-stage proptech venture capital firm. “Median rounds were just under the $3 million mark. While median round sizes have stayed pretty consistent, there are two notable differences in the seed funding climate compared to the more frenzied period we recently exited.”

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