LANCASTER, PA-Berkeley Point Capital LC has arranged a $10.4-million FHA-insured refinance loan for a 264-unit subsidized housing complex here, at a 3% interest rate.
The property is 100% affordable units, restricted to tenants with 60% or less of average monthly income under the Low Income Housing Tax Credit program. It has a Section 8 contract for 130 of the 264 units.
Financing was arranged through HUD's Section 223(f) mortgage insurance program for a fully amortized loan based on a 3.09%, 35-year, fixed-rate note. Proceeds were used to pay-off a previous FHA loan financed with Berkeley Point's predecessor firm.
The loan proceeds were constrained and conservatively underwritten at 73% loan-to-value. Berkeley Point's Nemo Hannafin of its Bethesda, MD, office led the company's team for the transaction.
The borrower is a real estate investment company focused on acquiring, stabilizing and preserving federally assisted multifamily rental properties throughout the United States, according to Hannafin.
Tax Credit Exchange Funding was provided by both the Pennsylvania Housing Finance Agency and the City of Lancaster HOME Funds. The existing Section 8 subsidy extends through 2030. Also, the LIHTC agreement will be effective for the life of the refinance.
The 40-year-old property has undergone a $10 million rehabilitation to included handicap-accessible units and upgrade kitchens, baths, floors, windows, doors and exteriors at the garden-style complex.
“FHA continues to be a key source of capital for multifamily acquisition and refinancing. With interest rates at historical lows and recent enhancements to HUD underwriting, the 223(f) program provides some of the most competitive loans in the nation right now,” said Berkley Point's Steve Wendel.
Berkeley Point is owned by entities affiliated with Ranieri Real Estate Partners LP and WL Ross & Co. LLC. The firm offers Fannie Mae, Freddie Mac, FHA, and Life Company products as well as a bridge program.
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