Dealmaker: Love Funding Secures $32M for Multifamily

Michael Tucker

May 08, 2018

Love Funding, Washington, D.C., closed $32.3 in construction, permanent and refinancing funds for multifamily communities in Texas and Michigan.

In Waxahachie, Texas in the Dallas-Fort Worth Metroplex, the firm arranged $26.3 million in construction and permanent financing for market-rate multifamily community Garden Valley Apartments.

When completed Garden Valley will include eight three-story walk-up buildings with 213 one- and two-bedroom units. The property will meet Green Mortgage Insurance Program requirements through the National Green Building Standard Program, which allowed a 25 basis point lower mortgage insurance premium.

The HUD 221(d)(4) loan insurance program allowed non-recourse financing for construction and then for a subsequent 40-year term.

In southwest Detroit Love Funding Director David Strachan and Midwest Regional Director Bruce Gerhart closed a $5.9 million HUD 223(f) loan to refinance and rehabilitate Central Towers Apartments.

The asset includes 232 one-bedroom and two-bedroom apartments in two high-rise buildings. All but two units are covered by a Section 8 Housing Assistance Payment contract to subsidize rents; the borrower renewed its Section 8 contract as part of the transaction. The two remaining units are low-income housing tax credits restricted at 60 percent of area median income.

"The 223(f) program provided the development team with low-rate, non-recourse financing for a 35-year term," Strachan said, noting the loan proceeds paid off current debt and will complete repairs and fund the reserve account.

Central Tower Apartments also received approval for Payment in Lieu of Taxes, which keeps the property affordable by making it temporarily exempt from certain tax payments.

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