Kevin Chadwick and Rick Oleson of Terrix Financial arranged $42.94 million in acquisition financing for three apartment communities in Walnut Creek, Calif.
The three communities have a total of 358 units.
In the single largest deal, Terrix arranged $18.4 million for 152 unites in six buildings in a garden-style apartment complex constructed in 1964.
The floating rate on the loan is adjusted monthly and has an initial rate of 3.89 percent. It also has seven-year term and is amortized over 30 years. The smallest of the three loans was for $11.66 million for 99 unites constructed in 1962.
The iniital rate in the floating rate loan is 3.39 percent. The terms are the same as they are for the other two loans.
The borrower is a private limited liability company that previously bought apartments in the Denver area.
“When they bought stuff locally here is how I met them,” Chadwick said. “They are California-based and while they might still own a property in Denver, they are now concentrating on the California market.”
Chadwick and Oleson chose the Fannie Mae lender through a competitive bid process.
The lender is based in New York and has a strong relationship with Terrix.
A lot of lenders were interested in funding the three transactions, Chadwick said.
“They like the area, they like the buildings and they liked the borrower,” Chadwick said.
“The borrower is very experienced,” Chadwick added. “Their equity partner is a huge fund. It is kind of a household name. The fund counts on local groups for their local expertise.”
Also, the deals were not highly leveraged.
“They were all 75 percent to 80 percent loan-to-value deals,” Chadwick said.
SOURCE: by John Rebchook, , Colorado Real Estate Journal