Bellwether Enterprise Real Estate Capital announced the projected closing of more than $430 million in loans for over 24 affordable housing properties across the country in the fourth quarter of 2017.
In the month of October alone, the affordable housing team closed more than $160 million, reported company officials. Bellwether Enterprise is the commercial and multifamily mortgage banking subsidiary of Enterprise Community Investment. Highlights include:
· Aeon Towers Portfolio: This deal involved a fixed-rate preservation acquisition loan for 10 affordable housing properties located in the Minneapolis–St. Paul metropolitan region. Combined, the properties feature 768 units and are located across four cities—Bloomington, New Hope, St. Paul, and Brooklyn Center.
Phil Melton, executive vice president and national director of affordable and Federal Housing Administration lending at Bellwether Enterprise, arranged the deal using Freddie Mac as the lender.
Bellwether Enterprise facilitated the acquisition using two tranches of the Freddie Mac fixed-rate mortgage pools. The first, a joint venture between Aeon, Enterprise Opportunity Fund, and BMO Harris Bank, included six properties and was financed by individual seven-year, fixed-rate loans. The second, a joint venture between Aeon and the Greater Minnesota Housing Fund, included four properties and was financed by individual 10-year, fixed-rate loans.
· Appling Lakes at Cordova Club: A Fannie Mae MBS (mortgage-backed securities) acquisition loan was arranged for a workforce housing property in Cordova, Tenn. Located outside Memphis, the 312-unit property is situated across 26 acres and includes 17 two- and three-story residential buildings and a clubhouse.
Melton and John Roberts, vice president of Bellwether Enterprise in the Dallas office, arranged the seven-year, fixed-rate financing using Fannie Mae as the lender. The loan features interest-only for the first year—enabling the borrower to take advantage of reduced debt service obligations while completing extensive improvements to unit interior finishes and amenity refurbishments.
· Building 9 South (Mercy Magnuson Place: In this deal, the Freddie Mac Forward Tax Exempt Loan (TEL) program was used for the gut renovation of an affordable housing property in Seattle. The project entails the adaptive reuse and rehabilitation of a historically significant naval barracks into a 148-unit affordable apartment building. The project will include amenities such as a health center, a daycare center, and a computer lab. The building’s exterior and key historic interior elements will be preserved, and energy efficiency will be prioritized during reconstruction.
Jim Gillespie, senior vice president of Bellwether Enterprise in the New York office, originated and structured the financing using Freddie Mac as the permanent lender. Enterprise Community Investment will provide the low-income housing tax credit (LIHTC) equity on the project. The Freddie Mac TEL loan will finance a 108-unit portion of the total project, while a separate 9% LIHTC transaction will finance the Building 9 North phase. The permanent funding sources for the Building 9 South phase include the Freddie Mac permanent loan, 4% LIHTC and historic tax credit equity, three soft subordinate loans, a deferred developer fee, and owner equity.
· The Savannah at Gateway: Bellwether Enterprise arranged a Fannie Mae MBS 15-year fixed-rate loan for an affordable housing property in Plano, Texas. The senior community is a LIHTC property that features 292 units reserved for tenants aged 55 or older. The property includes a clubhouse, a fitness center, and a recreation room. Individual apartments also feature balconies, high ceilings, and efficient appliances.
Roberts and Jon Killough, senior vice president of Bellwether Enterprise in the Montgomery office, arranged the loan using Fannie Mae as the lender. The financing will pay off existing bonds used for construction and help ensure the property remains an affordable place for moderate- to low-income tenants to live.
“The need for affordable housing is growing at a rapid rate across the country, yet supply continues to dwindle,” says Melton. “I’m proud of the entire Bellwether Enterprise Affordable Housing team for their dedicated efforts to address this alarming problem, which affects over 11 million Americans who are forced to spend more than 50% of their income on rent. By providing financing to borrowers that are committed to creating, preserving, enhancing, or acquiring affordable housing properties, we’re helping to ensure that nationwide, communities in need have a place to call home.”
