Multifamily Owners Beat Clock With $4M Loan

Stuart Wernick, president of Quantum First Capital in Dallas, tells GlobeSt.com that the refinance closed in 30 days and closed on the last possible day, Jan. 3. He says the three investors, doing business as NCM Management Ltd., bought the general partner's 1% interest a year ago in the complex, but was bound to an original partnership structuring that barred renovations or financial changes without approval from the majority owner, which is now the Aimco-controlled National Corporate Tax Credit Fund due to a portfolio buy three years ago. As a result, the two owners had never met and the approval took nearly a year to secure, Wernick confides.

With the loan cleared, the trio is ready to spend $600,000 on renovation at the class C complex at 3636 W. Red Bird Lane in Dallas. Wernick says occupancy was hovering 90%, but plummeted to 50% in the past six months due to needed repairs.

Washington Mutual Bank's Dallas and San Francisco office bundled a three-year interim package with a 75% loan-to-value ratio at a floating interest rate that's 250 points over Libor. The interest rate kicked in at 5.05%, Wernick says.

The 20-year-old Redbird Trails, positioned on 10.2 acres, is a mix of one- and two-bedroom units ranging from 600 sf to 932 sf. Its rents bring in $445 to $690 per month. Wernick says the renovation will drive a rent hike since comparable properties on the South Side are getting 85 cents per sf. NCM Management oversees the asset, which is assessed at $4.7 million by Dallas Central Appraisal District.