$26,200,000 Recently Financed Multifamily

Capital Partners successfully navigated a challenging task, overseeing the transition from a ground-up construction loan to bridge debt for an 82-unit, 47,848 SF multifamily property. Originally funded by Kevin Heisser and Jon Fulton, the construction loan faced maturity during the property's early lease-up phase, following its Certificate of Occupancy in November 2023. Our team strategically sought a bridge lender to retire the existing construction debt, offering payment and opex reserves to address cash flow challenges until the property achieved a 1.0x Debt Coverage Ratio (DCR) in approximately 8-12 months.

In our pursuit, we identified a lender offering a 1-year floating rate, significantly surpassing the existing lender's extension option by over 300 bps. The bridge loan featured favorable terms, including limited covenant restrictions, a 12-month interest-only period, and two extension options. This structure provided the Borrower flexibility in leasing up the property at their pace without the pressure of repaying the bridge loan rapidly. Mitigating factors contributing to the success of this transaction included the strategic location of the asset, its classification, and the Sponsor's track record in completing the project amid challenges such as tight labor markets, supply chain issues, and increased material costs.