The transaction was an acquisition of a newly built community owned by an existing Public Facility Corporation (PFC), an economic development tool that encourages affordable housing initiatives. Lument was able to collaborate with the PFC and Freddie Mac to structure the loan. Upon acquisition, the apartment complex will be managed by a borrower-affiliated management company with 30 years of experience in managing income-restricted rental properties, including mixed-income units.
The Freddie Mac loan features a 10-year fixed rate, interest-only payments for the first five years, a 35-year amortization, and competitive spreads.
“Lument was able to optimize the underwriting with Freddie Mac and fund a value-constrained loan for the borrower,” said Lument’s Kress. “More importantly, Estraya Boerne will be able to continue providing housing stability for low-moderate income households and increase economic diversity in the area.”
Built in 2022, Estraya Boerne offers one- to three-bedroom apartments with amenities such as a resort-style pool, fitness center, and gated access. The property is located in the Hill Country submarket where, according to MRI ApartmentData, apartment occupancy increased by 15.4% year-over-year in May.
About Lument
Lument, a subsidiary of ORIX Corporation USA, is a national leader in commercial real estate finance and delivers a comprehensive set of capital solutions customized for investors in multifamily, affordable housing, and seniors housing and healthcare real estate. Lument offers Fannie Mae, Freddie Mac, FHA, USDA, and balance sheet financing, as well as a full suite of capital market lending products. In addition, Lument provides a suite of real estate advisory solutions including real estate investment sales, investment banking, and investment management solutions. The company has approximately 600 employees in over 30 offices across the United States.
Securities, investment banking, and advisory services are provided through Lument Securities, LLC, member FINRA/SIPC. Lument Investment Management, LLC, is registered as an investment adviser with the U.S. Securities and Exchange Commission. For more information, visit https://www.lument.com/.