Dealmaker: Greystone Provides $36M in Green Building Financing
Greystone, New York, provided $30.9 million in FHA-insured construction financing for multifamily development project The Flats at Apex 540 in Apex, N.C.
Greystone Managing Director Donny Rosenberg originated the financing. Borrower RST Development utilized HUD’s 2016 MAP Guide standards for a lower mortgage insurance premium based on HUD Green and Energy-Efficient Multifamily Housing requirements.
To qualify for the energy-efficiency MIP reduction, a real estate project must produce a Statement of Energy Design Intent score of 75 or higher. The Flats at Apex 540 produced an 82 SEDI energy score.
The Flats at Apex 540 will include 212 residential units in three four-story buildings.
Rosenberg said Apex currently has a strong 96-plus percent occupancy rate.
“Based on the market fundamentals of the region, the reputation of the developer and their extensive experience in HUD financing, this project was fast-tracked by the Atlanta HUD office for a straight-to-firm commitment submission instead of the typical two-stage process,” said Greystone Deputy Chief FHA Underwriter Phiet Nguyen. He noted that could expedite loan commitment by at least four months.
Greystone also provided a $5.2 million Fannie Mae Delegated Underwriting and Servicing loan to refinance The Duddington in Washington, D.C. Managing Director Andrew Ellis of Greystone’s Rockville, Md. office originated the loan.
Ellis said Fannie Mae’s Multifamily Green Financing can give property owners investing in energy- and water-cost reducing retrofits preferential pricing and additional loan proceeds. “The Duddington loan was a non-recourse, 10-year fixed-rate loan with a 30-year amortization that received the Fannie Mae Green Building Certification pricing break,” he said.
The Duddington, a three-story, 34-unit market-rate apartment building dates to 1910. The owners purchased the property in 2014 and invested more than $1.5 million in environmental capital improvements including rooftop solar panels and double-pane windows. They also replaced the gas-fired boiler heating system with in-unit individual HVAC systems. The building received the EPA Energy Star certification in December.
Ellis called Fannie Mae’s green lending platform “a win-win” for property owners. “They are able to lower overall operational costs, benefit the environment and receive favorable terms for adhering to environmental standards,” he said.
