Category Archives: Multifamily

Closed: Cash-out Refinance of a Multifamily Property

Q10 KDH Vice President Larry Peters and Senior Associate Adam Unger arranged permanent debt for the refinance of a 102-unit apartment complex in Brazoria County, TX. Larry and Adam worked on behalf of the borrower to secure a 20-year, fixed-rate loan with 5-year rate adjustments through a correspondent life insurance company.

“The borrower plans a major addition to the asset and the beauty of this loan is that the lender required no escrow, no future approval, and funded the entire loan without a holdback,” Larry Peters said.

CLOSED: West Houston Apartments

Q10 KDH Vice President Ryan Watson provided financing with a small-balance Freddie Mac loan for a multifamily property located in Houston, TX. The transaction closed with a 7-year term and a 4.68% interest rate. The Sponsor purchased a property less than two years ago, and through a planned rehab project and better property management, was able to increase the value of the property. Ryan Watson was able to pull equity from the project and provide non-recourse financing with flexible pre-payment options.

Fannie Mae Green Loan

Q10 KDH Vice President Larry Peters and Senior Associate Adam Unger provided a cash-out refinance for a multifamily property in a secondary market of Texas. The borrower was looking to continue to hold their asset for at least 15 years and they received a 15-year term, full interest only and returned cash to the partners.

Larry Peters stated, “The borrower received an approximate discount of 33 basis points in their interest rate for agreeing to implement water saving devices. That will save $1 million in interest over the life of the loan. Coupled with the interest only component over 15 years and the water saving cost, the borrower reduced their loan payment while putting $3 million in their pocket and still own the asset.”

Fast Closing and Cash Out for Multifamily Property

Q10 KDH Principal Gary Hough and Vice President Matt Franke provided permanent fixed-rate financing with our correspondent lender for a multifamily property located in the Greater Houston Area. The transaction closed with a 10-year term and a 4.04% interest rate for a loan amount of $10,750,000. This property was a refinance of a property KDH financed 10 years ago with another correspondent insurance company.

After taking this loan request to the market, our correspondent lender ultimately offered the best overall terms that most closely aligned with the borrower’s objectives. The loan process was very smooth and resulted in a closing only 33 days from application execution.

The refinance resulted in a 200-basis point reduction in the coupon rate while providing the sponsor with a very significant “cash-out”. KDH has enjoyed a relationship with this borrower for over 20 years.

Low-Rate Financing for Apartment

The team of Q10 KDH Vice President Larry Peters and Senior Associate Adam Unger provided a fixed-rate life company loan from our correspondent RiverSource for an apartment community in Houston, TX.

The 10-year, fixed-rate loan had a 4.0% interest rate that was locked at application, providing the borrower peace of mind during the recent interest rate market volatility. “Life companies are very competitive with Fannie Mae and Freddie Mac on lower leveraged loans such as these. These agencies could not come close to the low interest rate, provide an early rate lock, or match the low closing costs and minimal servicing requirements of the life company lender.”- Adam Unger

Fannie Mae Financing Provided for Houston Multifamily Property

Q10 KDH Vice President, Larry Peters arranged Fannie Mae DUS financing for a multifamily property located in Houston, Texas.

The financing provided our client two years of interest only and a floating rate with flexible prepayment. The asset received a seven-year term and a low interest rate in the mid 3% range.

“The asset was located outside the Houston MSA and many lenders were more conservative due to the location. Our job is to educate the lender and show them the value of looking at the opportunity from a perspective that others don’t. We were able to accomplish the borrower’s wishes by delivering a higher LTV than what the majority of the market was comfortable in quoting but maintain the aggressive pricing that is available for multifamily assets in the market today.” – Larry Peters