NEW YORK, NY — Lument, the combined organization of Hunt Real Estate Capital, Lancaster Pollard, and RED Capital Group, has provided a $43 million Fannie Mae DUS® Conventional Multifamily loan to refinance Ironclad Apartments, a 172-unit mid-rise apartment community in Minneapolis, Minnesota that debuted in 2019.
The loan refinances construction debt from a bank the borrower utilized to build Ironclad and a neighboring hotel starting in 2017.
“We were proud to partner with the sponsor, as well as Rohit Narayanan at Lighthouse Advisors, to complete this Fannie Mae refinance,” said Nicholas Diamond, vice president at Lument. “This was the sponsor’s first agency deal and first multifamily project in over two decades, and we were humbled to be selected as their partner in this undertaking. With the new structure in place, Ironclad is well-positioned to reap the benefits of agency financing for years to come.”
In February of this year, the transaction was originally expected to proceed as a Fannie Mae Multifamily Near-Stabilization execution. In the wake of the COVID-19 crisis and subsequent market disruption, Fannie suspended the program, yet was able to work with Lument to quickly pivot to the conventional option.
The $43 million loan features a low, fixed interest rate and 10-year term with three years of interest only followed by a 30-year amortization schedule. In addition to paying off construction debt with low-cost capital at a fixed interest rate, the closing provides for substantial cash-out proceeds to the sponsors of approximately $2.1 million.
Ironclad Apartments is a “class A” property with high-quality amenities, as well as two commercial units. Due to the high-quality nature of the asset and its prime location, Ironclad was able to successfully lease up and stabilize during the summer months despite challenges caused by the pandemic.
ORIX Real Estate Capital Holdings, LLC, d/b/a Lument, is a subsidiary of ORIX Corporation USA. Lument is a national leader in commercial real estate finance. As the combined organization of legacy industry experts Hunt Real Estate Capital, Lancaster Pollard, and RED Capital Group, Lument delivers a comprehensive set of capital solutions customized for investors in multifamily, affordable housing, and seniors housing and healthcare real estate. Lument is a Fannie Mae DUS®, Freddie Mac Optigo®, FHA, and USDA lender. In addition, Lument offers a suite of proprietary commercial lending, investment banking, and investment management solutions. Lument has approximately 600 employees in over 25 offices across the United States. Securities, investment banking, and advisory services are provided through OREC Securities, LLC, d/b/a Lument Securities. For more information, visit www.lument.com.