Dealmaker: NorthMarq Completes $240M Refinancing for California Multifamily Portfolio

NorthMarq’s Newport Beach, Calif., office arranged $240.4 million to refinance a six-property multifamily portfolio in southern California.

Michael Elmore, executive vice president/managing director of NorthMarq’s Newport Beach office, arranged financing for the borrower, Advanced Real Estate Services Inc., through its relationships with Freddie Mac and Fannie Mae. The financings generated more than $100 million in cash-out proceeds. The refinance proceeds will be used as the initial investment into the $250,000,000 Advanced Fund 20-1.

Three of the properties are located in Orange County, two are in Riverside County and one is in Los Angeles County. The portfolio includes 1,223 units. Properties include:

Corona Pointe Resort: The 714-unit multifamily property received financing of $120.9 million. It is located at 3957 Pierce Street in Riverside. The transaction was structured with a 10-year term with 5-years of interest only followed by a 30-year amortization schedule. NorthMarq locked in financing at a 2.84 percent interest rate.

Corona Pointe Townhomes: The 63-unit multifamily property received financing of $14.279 million. It is located at 11511 Magnolia Avenue in Riverside. The transaction was structured with a 10-year term with 5-years of interest only followed by a 30-year amortization schedule. NorthMarq locked in the financing at a 2.84 percent interest rate.

The 5800 Apartment Home: The 149-unit multifamily property received financing of $35.587 million. It is located at 5800 South Street in Lakewood. The transaction was structured with a 10-year term with 5-years of interest only followed by a 30-year amortization schedule NorthMarq was able to lock in the financing at a 2.84 percent interest rate. 

Pacific Palms Apartment Homes: The 149-unit multifamily property received financing of $35.85 million. The 2-building property is located at 111 West Orangewood Avenue and 2045 South Haster Street. The transaction was structured with a 10-year interest-only term. NorthMarq was able to secure the financing at a 2.71 percent interest rate. 

Avignon Apartment Homes: The 88-unit multifamily property received financing of $19.825 million and is located at 1361 & 1375 West Valencia Drive and 220 South Basque Avenue in Fullerton. The 3-building property resides on 2.53 acres of land. The transaction was structured with a 10-year term with 5-years of interest only, followed by a 30-year amortization schedule. NorthMarq was able to lock in the financing at a 2.84 percent interest rate.

Washington Place: The 60-unit multifamily property received financing of $14 million and is located at 1311 East Washington Place in Santa Ana. The transaction was structured with a 10-year term with 5-years of interest only followed by a 30-year amortization schedule. NorthMarq locked in financing at a 2.84 percent interest rate.

“Freddie Mac financed the first five assets for $204.6 million during the initial phase of the COVID 19 crisis and held all of the financial terms without change,” Elmore said. “Pacific Palms Apartment Homes was subsequently financed by Fannie Mae for $35.8 million once the COVID-19 crisis was well-defined and they also held all terms and conditions. Both lenders extended their deep relationships with Advanced Real Estate Services.” 

“We were thrilled to secure such attractive financing even during the peak of the pandemic,” said Richard Julian, President of Advanced. “With the proceeds from these refinances, we are purchasing multiple properties through our new Fund structure. We are in escrow on three properties, all procured ‘off market.’ We have more than $200 million of fully-discretionary equity to place, so we are aggressively seeking further multifamily acquisition opportunities.”