APARTMENT BRIDGE LOANS

Bridge Loans in DFW for Stabilized Apartments or those in need of minor to moderate Renovations, Rehabilitation, or other value-adds.

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Multifamily Bridge Loan Amount:

$7,500,000 – $75,000,000 (larger upon request)

Multifamily Property Bridge Loans in Texas

Advantages

“One-Stop Shop” if looking for FHA or Agency permanent debt but need short-term bridge financing
Fast Closing to facilitate purchase or maturing existing debt
No exit fee if financing originated via G.R.E.A.’s permanent debt options

Loan Purpose
This program is specifically designed for properties that are either stabilized or are in need of minor to moderate renovation or other value-add strategy.

Our bridge loan program can be used to finance stabilized properties while G.R.E.A. underwrites the permanent financing or fund moderate rehabilitation or retenanting where the Borrower requires to complete a value-add strategy before securing permanent financing through an FHA, Fannie Mae, and Freddie Mac execution.

Eligible Properties
Multifamily and manufactured housing communities

Loan Amount
$7,500,000 – $75,000,000 (larger upon request)

Deal Structure
Variable rate first mortgage

Term
Typically up to 3 years (including extensions)

Amortization
Interest-only (some amortization may be required after first two years of term)

Interest Rate
Interest generally at a floating rate, specified as a competitive market rate spread over a LIBOR floor

Loan Commitment Fees
0.50% to 1.0% (depending on loan size)

Application Fees / Deposits
$15,000 per property non-refundable processing fee (fee depends on loan size and complexity) plus approximately $20,000 per property escrow deposit to cover the cost

Rate Index
30-day LIBOR with a market rate LIBOR floor.

Interest Rate Management
Borrower shall purchase an interest rate cap for the duration of the initial loan term at strike rate to be determined during due diligence. Counterparty must be rated A2/A.

Prepayment / Exit Fees
Generally, the loan will be open to prepayment after six months subject to the payment of an exit fee. The exit fee shall be waived if G.R.E.A. provides permanent financing.

Borrower Recourse
Typically non-recourse with standard carve-outs for environmental, bankruptcy, fraud and misapplication of funds, etc.; Partial recourse and/or operating deficit and completion guaranty may be required for properties undergoing more significant renovation.

Maximum LTV
Up to 90.0% of current value and 80% of stabilized value

Minimum Debt Service Coverage
The loan amount is sized such that the DCR will provide a minimum coverage of 1.00x at the actual “interest only” rate. The loan amount is also sized based on sufficient evidence that rents can be increased to provide sufficient cash flow to support a DCR at a minimum stressed constant of 1.25x on multifamily properties (including MHC’s). An interest reserve may be required.

Equity Requirements
Typically not less than 10.0%-15.0% cash equity

Escrows
Taxes, Insurance and Replacement Reserves

Third Party Reports
MAI Appraisal (expanded or separate market study may be required for properties with a value-add component); Environment Phase I and Engineering/Structural Report prepared by approved professionals.