Dealmaker: Berkadia Secures $57M for Multifamily

Michael Tucker mtucker@mba.org

October 17, 2018


Berkadia, New York, secured $57.1 million in financing for multifamily assets in Virginia and Arizona.

In Alexandria, Va. Berkadia secured $47.9 million for Morgan Properties' newest acquisition, Bennington Crossings. Morgan Properties, King of Prussia, Pa., paid $62.3 million for the 308-unit property.

Berkadia Managing Director Jim Badolato and Associate Director Mike McKee of Berkadia's Philadelphia office structured the Freddie Mac financing. The 10-year loan carried a 4.12 percent fixed interest rate. Badolato noted Morgan Properties has budgeted more than $3.8 million in near-term capital to renovate and modernize the property's units.

The greater Washington, D.C. region is the second-most populated metro area on the East Coast, with a 5.4 percent projected population growth over the next five years. Average apartment occupancy is projected to reach 95.9 percent by year-end 2018, part of a five-year sustained growth trend.

Bennington Crossings is a 1960's-vintage garden-style community on 13.1 acres along North Armistead Street in Alexandria's Seminary Road submarket. The property is near Mark Center, where Morgan Properties already owns a concentration of 2,664 apartment units and a neighborhood shopping center.

In Tucson, Ariz., Berkadia arranged sale and financing of Mission Creek Apartments, a 200-unit garden-style multifamily property. Senior Managing Director Art Wadlund, Senior Director John Laratta and Director Clint Wadlund managed the $12 million sale for the seller. Berkadia Managing Director Aaron Abelson secured $9.2 million in acquisition financing through Freddie Mac for buyer AndMark Investment Fund IV and its manager AndMark Management Co., Los Angeles.

The 10-year loan closed with a 4.71 percent interest rate, a 30-year amortization schedule and three years of interest-only payments. The loan represented a 78 percent loan-to-value ratio.

"This was the second acquisition for AndMark in the Tucson market over the last eight months," Abelson said. "The structure provided allowed the client to maximize its return on this investment."

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