Dealmaker: Eastern Mortgage Capital Closes $71M

Eastern Mortgage Capital, Boston, closed $44.9 million in construction-to-permanent financing for Kin on Green Apartments, a 108-unit mixed-use property in Philadelphia.

“The financing allowed our clients to maximize loan proceeds while securing a historically low interest rate for the next 40 years” said Peter Panagako, President of Eastern Mortgage Capital. “The option to fully amortize the loan or pay it off early provides the developer with maximum flexibility and protection against interest rate increases.”

EMC used the HUD 220 loan program to provide both construction and permanent financing on this Opportunity Zone project in one loan closing. Eastern Mortgage Capital correspondent Real Property Capital, Philadelphia, originated the loan.

Kin on Green will deliver new residential units and ground floor commercial space to downtown Philadelphia. The infill redevelopment property replaces an underused commercial building that previously occupied the site.

Eastern Mortgage Capital also provided $26.5 million in permanent financing on Providence Square Apartments, a 284-unit multifamily property in Rexburg, Idaho.

Panagako noted the FHA-insured 223(f) 35-year fixed-rate loan achieved every goal set by the borrowers at the beginning of the process. “EMC was able to amalgamate multiple phases with differing owner-entities and construction/mini-perm loans into a single take-out loan for the newly-completed property,” he said. “Despite being in a student-dominated market, the 35-year self-amortizing loan achieved a rate that was materially below agency 10-year loans, which, along with lower minimum debt service requirements and our ability to value at market rents, allowed us to provide a loan with the maximum proceeds available.”