Rise on Thomas Multifamily – Value-Add Acquisition

Southwest, US

$15,040,000

Funding Purpose

Tauro Capital Advisors was engaged on an exclusive basis to place a non-recourse bridge loan for the acquisition and renovation of a 100-unit multifamily property.

Property Description

The 100-unit multifamily property consists of 37 studio units, 62 1-bed units, and one 2-bed unit. The partially-renovated asset features two pool areas with built-in BBQ’s, two workout rooms, and ample parking.

Sponsors

While the Sponsor owns two other properties in the market, this was their first renovation project. The Sponsor’s submarket expertise, along with the vast renovation experience of the property manager, helped to get capital sources comfortable with this being their first value-add project.

Challenges

  • With market conditions deteriorating, many capital sources were hesitant to lend on a transitional asset. Floating rates were rising quickly leading to higher interest rates and interest rate cap prices.

Solutions

  • Tauro was able to locate a capital provider that provided a fixed interest rate for a bridge loan. The rate is fixed for the entire three year term and was locked at application. The Sponsor was able to fix their interest payments and avoided having to pay for a costly interest rate cap.

Funding

  • Loan Amount: $15,040,000
  • Loan-to-Cost: 67% LTC
  • Interest Rate: 6.125% Fixed
  • Origination Fee: 1.0%
  • Exit Fee: None
  • Term: 3 Years
  • Amortization: Interest Only
  • Yield Maintenance: 12 Months
  • Recourse: Non-Recourse (with Carevout Guarantys)

Senior Director  | Capital Advisor

310-963-1350

podonnell@taurocapitaladvisors.com