LOS ANGELES, CA – Thorofare Capital has recently funded a non-recourse, $8,222,000 recapitalization loan for a 420-unit multifamily portfolio owned by an Arizona-based distressed real estate investment and management firm. The transaction closed in just one week from application.
The portfolio of three multifamily properties includes Dwell at the View in Atlanta, as well as Dwell at 555 and Dwell at 1794 in Marietta. The loan represents an attractive loan basis of $19,576 per unit. The sponsor, an experienced residential investor with a track record of acquiring, stabilizing, and managing 5,000+ multifamily units, plans to complete the renovations, increase occupancy, and improve cash flows.
Proceeds of the portfolio loan are being used to pay off existing low-leverage senior loans, repatriate equity to the sponsor for use in a new, separate purchase transaction, and reserve $900,000 towards the completion of the renovations at two of the properties, Dwell at 555 and Dwell at 1794. Between 2011 to late 2012, the sponsor acquired each of the properties through separate transactions and subsequently commenced a complete overhaul renovation, re-branding, and stabilization plan to maximize its value-add strategy prior to a refinance of the properties.
The Dwell at the View is a 12-building multifamily community totaling 216 units, located on 13.85 acres in Northwest Atlanta. The property is currently 80% occupied and is undergoing the tail-end of an approximately $2,000/unit interior and exterior upgrade plan.
Dwell at 555, a 12-building multifamily community totaling 112-units located on 7.56 acres, and Dwell at 1794, a 9-building multifamily community totaling 92-units located on 6.71 acres, were originally built by one developer and share identical floor plans as well as design. Subsequent to the initial purchase, the sponsor established a $2,400,000 capital improvement plan, which includes curing deferred maintenance, restoring the interiors of the units, and upgrading the building exterior as well as common areas. To date, 80% of the exterior renovations have been completed and 70 of the total 204 units at Dwell at 555 and Dwell at 1794 have been rehabilitated with occupancies at 67% and 74%, respectively.
Thorofare has retained an engineering and construction services firm to work in conjunction with the sponsor in efficiently finalizing the renovations through timely disbursements and completion inspections. Thorofare provided a high degree of certainty of execution, flexible pre-payment options, and competitive pricing.
About Thorofare Capital: Thorofare Capital, Inc. (“Thorofare”) is a direct portfolio lender specializing in short term commercial real estate loans. Thorofare is currently deploying capital from its second discretionary real estate debt fund, targeting investments between $2 million to $25 million in primary and secondary US markets. The firm will also consider select transactions with strong components in tertiary markets. Thorofare is based in Downtown Los Angeles.
For more information, please contact:
Felix M. Gutnikov