DENVER—Richard Bassuk, president of the Bassuk Organization Inc. and CEO of Greystone Bassuk Group, revealed the completion of a program to refinance nine Maxx Properties with refinancing proceeds aggregating $140 million.GlobeSt.com has learned that the portfolio consists of nine properties in Denver totaling 1,830 units, but the firm could not reveal anything further about the properties, including location or property names, at this time.
Bassuk stated that in 2012 Maxx asked TBO to analyze its portfolio and suggest various refinancing and enhancement strategies. With respect to Maxx's Denver portfolio, TBO advised Maxx to undertake a renovation program and refinance existing mortgages with HUD on the basis of the enhanced rents resulting from the renovations.
Bassuk tells GlobeSt.com that he anticipates further financings with HUD in both Denver and other US markets. “These refinancings are attractive since they mature in 35 years, have low interest rates, and the underwriting takes into consideration rents achieved by the project after renovation of the units. This advantage is not available with any other non-HUD lender.”
Despite the prepayment penalties under the terms of existing mortgages, TBO determined refinancing was highly accretive to the long-term profitability of Maxx's portfolio due to low interest rates and the substantial increase in loan proceeds that Maxx secured through HUD's unique refinancing program. HUD sized new mortgages based on Maxx's renovated rents.
Upon the closing of refinancings under Phase I of this program, Maxx realized substantial net proceeds after prepayment penalties and all costs associated with the refinancing. Keith Halperin, counsel to Maxx Properties, says that “This ingenious refinancing program was conceived by Mr. Bassuk, and enabled Maxx to eliminate deferred maintenance, renovate apartments to a high standard, and realize substantial project proceeds utilizing the HUD program and the low level of interest rates.” Mr. Halperin went on to add that “since interest rates continue at a low level, Maxx is now proceeding with Phase II of a similar program for additional projects.”
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
