Opus Bank is pleased to announce it provided:
- Title: Bridge Loan
- Amount: $5,919,000
- Month: June
- Year: 2016
Opus Bank provided a $5,919,000 bridge loan to finance the acquisition and renovation of an existing 68-unit apartment project. The sponsors are highly experienced, value-add investors, specializing in the multifamily market. This is a well-located infill property in a stable suburban neighborhood.
The seller began renovating the property but only completed 35 of the 68 interior units. The buyer’s business plan was to fully complete the renovation and raise the rents to market.
The transaction was an acquisition with a 1031 exchange, and the borrower required a tenants-in-common ownership structure.
Opus successfully closed the loan on time, which was critical given the 1031 exchange and required closing time frame. Opus was able to look beyond the current income stream and underwrite the projected income at the stabilization of the property. The initial funding was $5,724,000 or 70% of the purchase price. Future renovation funding of $195,000 is available via monthly draws for completion of the apartment upgrades. At closing, the property was generating above break-even cash flow. Since the units will be upgraded as leases roll over, no interest reserve was required. Once the property is fully funded and stabilized, the loan will represent approximately 70% Loan to Cost and 70% Loan to Value.