ARIZONA-Sabal Financial Group L.P. has expanded its recently launched builder lending program to include the Arizona market. Originally launched in California, as GlobeSt.com previously reported, the program will now offer non-recourse construction and acquisition-and-development loans to established homebuilders in this state. Tom Farrell, Sabal's director of building lending and a 25-year veteran in construction lending, will lead the program.
Sabal says it is filling a void in the lending market left by the departure of traditional capital sources, namely commercial banks, and comes at a time when homebuilders are actively pursuing quality development opportunities.
“Sabal's builder lending platform is growing to meet the expanding footprint of the lending business,” said Pat Jackson, CEO of Sabal, in a prepared statement. “As a non-regulated lender and leader in the real estate industry, Sabal has the capability to provide homebuilders in Arizona quick, dependable access to capital they may have previously struggled to obtain.”
The firm expects to lend in the $3-million to $35-million range, providing loans of up to 80% of project cost or 75% of value, flexible pricing and terms of 12 to 36 months for qualifying projects. As a non-regulated lender, Sabal can provide non-recourse construction and A&D loans secured with completion-only guarantees. Non-recourse loans are highly appealing to developers, especially given the challenges over the past several years in accessing construction loans, the firm says.
According to Farrell, “The Phoenix housing market continues to show improvement with increased new home sales and declining inventory. The homebuilders in this market are in need of capital, both debt and equity, to grow their business.”
A recent Marcus & Millichap apartment report shows that approximately 1,260 apartment units will be completed this year in the Phoenix metro area, creating a demand for this type of financing.
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Carrie Rossenfeld
Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.
