Dealmaker: Berkadia Secures $188M for Multifamily Assets

Berkadia secured $188.2 million in Freddie Mac funds to refinance multifamily assets in New York and Cleveland.

In Far Rockaway, N.Y. Director Michael Shmuely from Berkadia’s New York office secured $120.7 million in financing to refinance 917-unit high-rise property 711 Seagirt.

Freddie Mac, McLean, Va., supplied the 10-year loan with five years of interest-only amortization to Treetop Development, Teaneck, N.J.

Meridian Capital Group Vice Presidents Isaac Lifshitz and Thomas Wayda brokered the loan, which closed October 23. In addition to thie$120.7 million senior loan, the team also secured $25 million in preferred equity through entities affiliated with Pennybacker Capital, Austin, Texas.

“The property is a well-located asset offering affordable rents and the sponsors are long-term holders committed to improving the quality of life for their tenants via significant capital improvements,” said Shmuely. “Treetop has now recapitalized the stack at historically low interest rates.”

Located at 711 Seagirt Avenue, the property includes studio, one- and two-bedroom floor plans within walking distance of Rockaway Beach, Rockaway Beach Boardwalk and Queens Marina and Boat Dock.

The loan fell within Freddie Mac’s mission-driven goals. Nearly 40 percent of the property (358 units) is affordable to very low income tenants earning 50 percent or less of area median income and nearly 70 percent of the units are affordable to families at or below 80 percent of AMI.

In Cleveland, Berkadia secured $67.5 million in financing for Centric Apartments, a multifamily property with more than 28,000 square feet of commercial space in the city’s University Circle neighborhood. Director Dan Geuther in Berkadia’s Cleveland office secured the permanent refinancing through Freddie Mac for Ohio-based Midwest Development Partners. “The University Circle submarket has seen tremendous growth over the last 10 years as anchor institutions such as the Cleveland Clinic, University Hospitals and Case Western Reserve have continued to expand while rental housing options remained limited,” said Geuther. “This transaction was initially slated to be a lease-up loan. However, the lease-up of the property went significantly faster than anticipated and we were able to switch products during the processing phase. This pivot then allowed us to increase the loan amount and improve deal terms for the sponsor.”