Dealmaker: HFF Arranges $1.2B for Multifamily, Retail Portfolios

Holliday Fenoglio Fowler, Houston, arranged $1.21 billion in debt and equity for a 23-property multifamily portfolio and a 20-asset shopping center portfolio.

Working for Starlight Investments, Toronto, HFF secured $800.45 million in financing for a 23-property multifamily portfolio with 7,289 units across eight states. The debt placement team included HFF Senior Managing Director Matt Kafka, Managing Director Campbell Roche and Analysts Matthew Williamson, Tolu Akindele and Wilson Bauer.

The team secured a Freddie Mac Structured Pool Transaction with five-, six- and seven-year loan terms and both fixed- and floating-rate components. The loan allowed flexibility with collateral release provisions and varying prepayment windows. The transaction also used Freddie Mac’s index lock program, which allowed the sponsor to lock the underlying rate several months prior to closing.

Freddie Mac Multifamily Vice President of Production and Sales Lauren Garren noted the firm’s Structured Pool Transaction offering was created for complex single-sponsor portfolio transactions like this one.

HFF will service the master note, which is secured by a cross-collateralized pool of properties in Atlanta, Austin, Texas, Charlotte, N.C., Dallas, Denver, Houston, Las Vegas, Nashville, Orlando, Fla., Phoenix, Raleigh, N.C., San Antonio, Texas and Tampa, Fla. The properties have a 93 percent average occupancy rate.

HFF also advised Phillips Edison & Co., Cincinnati, in forming Grocery Retail Partners I and Grocery Retail Partners II, two joint venture partnerships totaling $414.5 million in asset value and encompassing 20 grocery-anchored shopping centers. The firm called it the largest shopping center recapitalization of the year.

Representing PECO and Phillips Edison Grocery Center Real Estate Investment Trust III, HFF arranged GRP I and GRP II JVs with Northwestern Mutual, Milwaukee, as the partner. 

Under the terms of GRP I, Northwestern Mutual acquired an 85 percent interest in a 17-center portfolio currently valued at $368 million. PECO maintained 15 percent ownership in the portfolio while providing asset and property management services for the joint venture. 

Under the terms of GRP II, Northwestern Mutual invested in three shopping centers currently owned by Phillips Edison Grocery Center REIT III. Northwestern Mutual acquired a 90 percent interest in the portfolio, currently valued at $46.5 million, while PECO III maintained 10 percent ownership. PECO III said it intends to use the proceeds to expand its portfolio of grocery-anchored centers.

The HFF equity placement team representing PECO and PECO III included Senior Managing Directors Steve Hentschel and Danny Finkle and Senior Director Sheheryar Hafeez along with Senior Managing Directors Michael Joseph and Doug Bond.