How BWE's bridge-to-agency loan program provides stabilizing, non-recourse financing for multifamily transactions

BWE’s proprietary bridge-to-agency loan program is designed to offer a low-cost, variable-rate solution to address current refinancing gaps in the market.

Rising inflation and an increase in federal funds rates from near-zero to peaking over 5% has created challenges for commercial real estate borrowers with upcoming maturities, particularly for pre-stabilized ground-up construction and value-add projects.?

For many borrowers, refinancing in today’s market environment with a traditional, long-term permanent financing solution, such as a bank, is not economically feasible or strategically advantageous.

That’s where BWE’s bridge program with a national life insurance company can deliver the flexibility to bridge the refinance gap through lease-up or asset repositioning.

BWE bridge-to-agency in action

Since launching the bridge-to-agency loan program in April 2024, BWE has closed eight loans, with two more under application and scheduled to close in early 2025. These loans are located across the country including Nashville, Tennessee; Atlanta, Georgia; Kansas City, Missouri; Charleston, South Carolina; Fort Worth, Texas; and Philadelphia, Pennsylvania.

"The launch of our proprietary multifamily bridge program was a great success in 2024," said Matt MacCaughelty, BWE Director of Strategic Partnerships. "We were able to move on fast turnarounds to take out existing construction debt, finance light value-add acquisitions, and solve bridge-to-bridge refinance needs to further stabilize and transition into low-cost permanent debt financing. We’re excited to expand the program in 2025.”

The first property to receive financing through this new bridge loan was Sedgefield Apartments, a 280-unit development spread across 34 garden-style apartment buildings in Marietta, Georgia. BWE’s Atlanta office, led by Senior Vice Presidents Alan Tapie and Thomas Wiedeman, executed the three-year, $34.5 million bridge loan on behalf of their client, RPM Living.

This bridge loan allowed the borrower to refinance the existing debt and recapitalize the project to complete value-add upgrades, enabling the asset to better compete in the submarket.

“The BWE bridge program has been a great tool that allows us to bring a competitively priced proprietary product to our top multifamily clients,” Tapie said. "The profile of the program aligns seamlessly with BWE’s mission and culture, reflecting our commitment to supporting multifamily clients with creative capital solutions tailored to help them achieve their goals.”

Additional benefits of this product were on display with Beacon Place Northport, a 230-unit luxury apartment complex constructed in April 2024 in Northport, Alabama.

Having access to this product “allowed us to lower the borrower’s rate and give them an extended runway for their lease-up process,” said Paul Harbor, Senior Vice President in BWE’s Birmingham, Alabama office.

Harbor originated the 24-month, non-recourse, pre-stabilized bridge loan with an optional 12-month extension and a 30-year amortization on behalf of the borrower, an Alabama-based multifamily investor and repeat client.

This provided the client flexibility to free up borrowing capacity from the bank and was the most cost-efficient solution as it avoided layering fees by being an internal BWE product.

To learn more about this and other lending solutions, visit www.bwe.com.