Chicago Multifamily Secures $81M-Plus Fannie Mae Refinance
PGIM Real Estate provided the 12-year, fixed-rate loan to CEDARst Cos. for its converted, 342-unit apartment complex, The Draper.
CHICAGO, IL – CEDARst Cos. has secured an $81.7 million Fannie Mae loan to refinance The Draper, a 342-unit apartment complex in Chicago’s Uptown neighborhood. PGIM’s real estate investment and financing business, PGIM Real Estate provided the loan.
CEDARst Cos. began redeveloping and converting the 1950’s office building into a multifamily property, upon acquiring the asset in 2018. The renovations were completed in 2019.
The fixed-rate loan has a 12-year term, with six years of interest.
PGIM Real Estate’s VP, Craig Foreman and executive director, Lee McNeer led the refinancing on behalf of CEDARst Cos.
“This was a complex transaction, structured as a Fannie Mae Near-Stabilization Tier 2 loan,” states Foreman. “CEDARst—an existing PGIM Real Estate client—is the type of partner you need to successfully execute a deal like this in the current market environment. We were thrilled to have the opportunity to work with them again and to be associated with The Draper.”
“We were engaged mid-October, amidst a volatile interest rate environment given the 2020 election season,” says McNeer. “However, through CEDARst’s operations, our underwriting team’s analyses, and our partnership with Fannie Mae, we ultimately delivered loan proceeds that exceeded our loan application and the CEDARst team’s expectations. It was a true team effort and a perfect example of the strength of the DUS program.”
As a part of the redevelopment project, CEDARst restricted 10% of The Draper’s units for residents that earn up to 60% of the Area Median Income; as imposed by the City of Chicago Affordable Requirements Ordinance. Totaling 35 restricted units, the restriction resulted in 50% mission-driven business for Fannie Mae.
The project additionally received the Green Building Initiative’s Green Globes Multifamily for New Construction certification; and it was processed as a Fannie Mae Green Loan.
The property features residential units, as well as 32,000 square feet of ground-floor and top-floor commercial components. Fannie Mae and PGIM Real Estate worked to underwrite a portion of the commercial income related to essential services.
CEDARst Cos.’ FLATS brand currently manages the property.