Walker & Dunlop announced that it structured a $35.8 million Freddie Mac immediate delivery tax-exempt loan (TEL) for Smith & Henzy Advisory Group to acquire and rehabilitate Lake Delray Apartments, an affordable housing community in Delray Beach, Fla.

The 404-unit Lake Delray Apartments will receive $14.3 million in renovations to upgrade the apartments.
Courtesy of Smith & Henzy Advisory Group The 404-unit Lake Delray Apartments will receive $14.3 million in renovations to upgrade the apartments.

The loan was originally structured as a Department of Housing and Urban Development (HUD) 221(d) (4) cash-collateralized, short-term tax-exempt bond execution, which was later converted to the Freddie Mac TEL program when more flexible terms were required.

Frank Baldasare, senior vice president at Walker & Dunlop (NYSE: WD), led the origination team, which arranged the 17-year acquisition loan that provided for two years of interest-only payments followed by a 35-year amortization schedule. The Palm Beach Housing Finance Authority issued the tax-exempt loan, and the Delray Beach Housing Authority was the general partner to preserve the real estate tax abatement.

Lake Delray Apartments is a 404-unit rental community limited to residents 62 and older. The project will receive $14.3 million in total renovations to upgrade the apartments. The work will include 100% replacement of unit kitchens, baths, windows, flooring, and mechanical systems. Enhancements also will be made to property amenities, including the addition of a 1,200-square-foot gym, a yoga room, a library with computer rooms, a barbecue area, outdoor LED lighting, as well as renovations to the clubhouse and to two existing pools.

The property is near several senior service centers and a medical center.

The Delray Beach Housing Authority, through the Delray Housing Group, manages the property and provided project-based vouchers and housing assistance payment contracts for 193 of the units. Remaining units are restricted to 60% of the area median income.