NEW YORK, Jan. 11, 2022 /PRNewswire/ — Lument has provided a $15.1 million Fannie Mae conventional multifamily loan to facilitate the acquisition of Sommerset Place Apartments, a 144-unit multifamily community built in 1983 and located in Raleigh, North Carolina. James Kelly, a director in Lument’s Atlanta office, led the transaction.
“Through our successful collaboration, we were able to help this experienced sponsor acquire a quality community in an appealing market,” said Lument’s Kelly. “Further, we were able do so on a tight timeline and via a financing solution with multiple benefits, namely a full-term interest-only period and a reverse 1031 structure.”
The Fannie Mae loan carries a low, fixed interest rate, 30-year amortization, and 10-year term, all of which is interest-only (IO). The transaction was structured as a reverse 1031 exchange, in which the buyer acquires a replacement property before transferring the relinquished property.
The sponsor, who has been managing the property since 2017, has extensive experience successfully renovating properties after purchasing them. Following the acquisition, the sponsor plans to complete $2.7 million in substantial renovations to the community over the course of three years, including approximately $6,000 per unit allocated towards property-wide improvements and $13,000 per unit allocated towards unit renovations and upgrades.
The closing provides for approximately $223,000 for a green repair escrow. The borrower plans to implement green improvements to achieve 30% in combined energy and water savings.
ORIX Real Estate Capital Holdings, LLC, d/b/a Lument, is a subsidiary of ORIX Corporation USA. Lument is a national leader in commercial real estate finance. As the combined organization of legacy industry experts Hunt Real Estate Capital, Lancaster Pollard, and RED Capital Group, Lument delivers a comprehensive set of capital solutions customized for investors in multifamily, affordable housing, and seniors housing and healthcare real estate. Lument is a Fannie Mae DUS®, Freddie Mac Optigo®, FHA, and USDA lender. In addition, Lument offers a suite of proprietary commercial….ReadMore…