Love Senior Director Artin Anvar secured the financing through FHA's Section 223(f) loan insurance program.
“FHA’s 223(f) program is a non-recourse and fully assumable program,” Anvar said. “In this case it gave the borrowers a 35-year loan below 4 percent with 35-year amortization. The program allows leverage up to 83.3 percent, which also interested them.”
The new loan enabled the borrowers to pay off debt taken out to redevelop the property and preserve its historic character. Court Square Center was co-developed by the Memphis development team of John Basek, C. Yorke Lawson and consulting firm Chandler and Chandler, who worked with Telesis Corp. and New Community Partners, both of Washington, D.C.
Court Square Center includes three buildings--Lincoln American Tower, the Lowenstein Building and Court Annex Two--that include 75 market-rate apartments and 32,000 square feet of commercial space. Both the Lowenstein Building and Lincoln American Tower appear on the National Register of Historic Places. Built in 1886, the Lowenstein Building housed Lowenstein’s Department Store for decades while the Lincoln American Tower, a smaller replica of Manhattan’s Woolworth Building, served as Columbia Mutual Life Insurance Co.’s headquarters starting in the 1920s.
The city of Memphis contributed a significant economic development investment, Anvar said. In October 2006, a fire in a nearby church spread to the Court Square Center property, resulting in a total loss of the Court Annex building and severe damage to the other two. But the project continued and eventually encompassed a more comprehensive redevelopment plan, including work to preserve the building’s facades and strengthen their structures and foundations. He called the redevelopment a “centerpiece” of Memphis’s downtown redevelopment strategy.
Love Funding also secured a $16.4 million construction loan for St. Paul’s Square Senior Living, a new senior apartment community in a village center concept in McKinney, Texas.
St. Paul’s Square Senior Living will be part of Adriatica Village, a development modeled after the fishing village of Supetar in Croatia. Work began eight years ago on the development’s initial stages including a chapel surrounded by water, retail stores, medical offices and a weekly farmer’s market under a 128-foot-tall bell tower.
The new apartment addition, funded by FHA financing secured by Love Funding Senior Director Laura Saull-Smith, will include 121 units, all intended for people 62 and older. The project will also feature a small percentage of commercial space comprised of 35 individual office suites. This represents the second project within the Adriatica community insured using the HUD 221(d)(4) loan program.
“Just five months after completing the market-rate apartments, they are already up to 50 percent leased, which is way ahead of schedule,” Saull-Smith said.
Source: MBA NewsLink