APARTMENT RENOVATION AND REHABILITATION BRIDGE LOANS

Multifamily value-add loans for renovations, rehabilitations and stabilized apartments in Dallas Fort Worth.

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Multifamily Bridge Loan Amount:

$1,000,000 – $15,000,000 (larger upon request)

Multifamily Rehab / Reno Bridge Loans in Texas

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 where the client needs leverage above a first mortgage bridge loan.

Our short-term mezzanine 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 short-term debt to finance renovations to complete a value add strategy and secure permanent financing through a FHA, Fannie Mae, and Freddie Mac.

Eligible Properties
Multifamily and healthcare (SNF, AL/IL)

Loan Amount
$1,000,000 – $15,000,000 (larger upon request)

Collateral
Pledge of the equity of the first mortgage borrower, secured by UCC filing. Intercreditor agreement with first mortgage lender required.

Loan Term
Typically up to 3 years (including extensions). Coterminous with First Mortgage Loan

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

Interest Rate
Fixed or floating rate. 12-15% coupon varying with LTV, DSCR, market and sponsor

Loan Commitment Fees
1.0%

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 of the appraisal, structural/ engineering, and environmental reports, travel and due diligence.

Prepayment / Exit Fees
Generally the loan will be open to prepayment after one year subject to the payment of an exit fee calculated on the combined First Mortgage and Mezzazine loan amounts. The exit fee shall be waived if G.R.E.A. provides permanent financing. Mezzanine loan cannot be prepaid before First Mortgage Loan.

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

Maximum LTV
Combined maximum LTV of the First Mortgage and Mezzanine Loan is up to 90.0% of current value/costs and 80% of stabilized values.

Minimum Debt Service Coverage
The loan amount is sized such that the DSCR will provide a minimum coverage of 1.05x – 1.25x at the actual “interest only” rate, depending upon property type.

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

Third Party Reports
MAI Appraisal (expanded or separate market study may be required for properties with a valueadd component); Environment Phase I and Engineering/Structural Report prepared by approved professionals. Mezzanine loan may rely on approved First Mortgage Loan Third Party Reports.