Greystone has provided a $33,136,000 Freddie Mac affordable housing loan for the acquisition of three multifamily properties totaling 170 units in Arizona. The permanent financing was originated by Jon Morales of Greystone on behalf of Community Preservation Partners, LLC.
The mission-rich financing secured for the sale, which falls under Freddie Mac’s affordable housing finance mandate, includes a 17-year loan term with a 40-year amortization at 86% loan-to-cost. The 97% occupied properties, which are covered by one bond allocation, include 50-unit Morningside Villa, 17802 North 19th Avenue in Phoenix; 60-unit Buckeye Villa, 300 South 9th Street in Buckeye; and 60-unit Tempe Villa, 3425 South Priest Drive in Tempe.
Upon the closing, the new owner plans to invest $7.9 million to renovate the three properties. Each property is covered by a long-term HAP contract that includes 100% of the units, converted to a new 20-year HAP contract at time of acquisition, along with the use of 4% Low Income Housing Tax Credits, yielding an anticipated 35% increase in rent collections. All of the units are restricted to 50% Area Median Income (AMI) for residents.
“It’s truly gratifying to help clients grow their businesses which positively impact people’s lives,” said Mr. Morales. “Freddie Mac’s long-term financing with 40-year amortization is designed to help affordable housing developers, owners and investors stay viable to create and maintain the homes that are so desperately needed in markets like Phoenix.”
“We are thrilled with the loan terms that Greystone was able to provide, including, especially, the 40-year amortization, which really helped to pencil out the financing for this critical affordable housing,” said Jack Aronson, Community Preservation Partners VP of Development and Acquisitions.
“Greystone has been a faithful steward in helping to orchestrate this complex financing, which will benefit hundreds of residents in Phoenix, Buckeye and Tempe,” said Anand Kannan, President, Community Preservation Partners. “We thank them for their time and dedication to obtaining the best execution possible so we can focus on making the properties the best they can be.”