Dealmaker: Walker & Dunlop Originates $100M Revolving Credit Facility
Walker & Dunlop, Bethesda, Md., structured a $100 million Freddie Mac Revolving Credit Facility for Presidium Group LLC, Dallas.
The credit facility was initially secured by two Austin, Texas properties, Solaris and The Violet. It included an additional $50 million in excess capacity for a potential of $150 million in total financing. W&D Managing Director Alex Inman led the team that arranged the five-year non-recourse line of credit with full-term interest-only payments.
“This type of financing allows the sponsor to secure credit and pricing terms prior to identifying property assets to back the debt,” Inman said. “The terms remain in place for the duration of the facility and a borrower can move assets in and out of the facility with no requirement to substitute assets.”
Solaris is a 562-unit garden-style apartment community three miles southeast of Austin’s central business district. The Violet is a 160-unit garden-style community six miles south of downtown Austin.
Inman noted structured products can pose new challenges not found in conventional agency products. “Loan documents are different; the underwriting is different; even obtaining credit approval is different. Due to these complexities, many lenders don’t even consider this offering.”
But after analyzing the borrower’s investment strategy and long-term goals, “it became increasingly evident that a Freddie Mac credit facility was going to be the most beneficial to the overall project,” Inman said.
Inman said Presidium Group “significant” experience with distressed and underperforming apartment communities in strong-performing metropolitan areas. The firm plans to coordinate with in-house and third-party architects to renovate and reposition the assets the assets.
In south Florida, Walker & Dunlop investment sales group helped Ares Management, Los Angeles, sell Signature at Kendall, a newly constructed Class A multifamily property in Kendall, Fla. Roberto Pesant and Chris Conklin, both Managing Directors, led the investment sales team.
The Real Deal South Florida reported Blackstone Group, New York, acquired the property for $139 million.
Pesant said Signature at Kendall benefits from the area’s high rental demand. Occupancy rates in Kendall have remained above 96 percent since 2010 and the area surrounding the property enjoys strong local employment.
Signature at Kendall was constructed in two phases in 2016 and 2017. A newly-built Publix grocery store is located half a mile away.
