Santa Ana-based Grubb & Ellis Co. has reworked the terms of a potentially crippling credit line and is raising $5 million from its largest investor, the real estate brokerage and investor said Thursday.
Grubb & Ellis said it reworked terms of a credit line with a unit of Deutsche Bank AG, giving the company two more months to make a $27.3 million payment.
It now has until Nov. 30 to make the payment, which originally had been due this week.
The reworked terms also give Grubb the option to pay off the entire $38 million credit line plus a related $29 million line at 65 cents on the dollar.
The amount due from Grubb wasn’t staggering, but it could have been enough to cripple the company.
Grubb had about $15 million in free cash as of June 30, plus another $18 million in restricted cash that only can be used for specific purposes.
It also said the company’s largest shareholder, real estate developer and Chairman C. Michael Kojaian, is providing a onetime $5 million infusion to the company.
The moves buy Grubb times as it continues to try and rework its finances.
The company said it sees “the amendment as a constructive step between the company and its lenders to facilitate completion of its efforts to recapitalize the company and further stabilize its balance sheet.”
Grubb’s beaten down shares surged last week, perhaps on speculation a deal was in the works. They were up about 90% last week and are flat this week on a market value of about $105 million.
The company as it exists today was forged in 2007 when Chicago-based Grubb & Ellis combined with real estate investor NNN Realty Advisors Inc. of Santa Ana.
