SAN FRANCISCO-The developer of a 114-unit luxury Downtown condominium tower here is close to receiving funds from its recently closed $82.3-million construction loan.
The developer is Folsom Ventures LLC, a joint venture of Lennar Homes of California Inc. and an LLC controlled by John Malcom of Malcom Properties. The construction lender is Fremont Investment & Loan. The mortgage broker was Elizabeth Shepard of Chapman Shepard Group.
The 20-story building is slated for 631 Folsom St., which is located South of Market Street near the intersection of Folsom and 2nd streets. The building will have retail and a lobby on the first floor, 108 two-bedroom/two-bathroom units on floors two through 19 and, on the 20th floor, six two-story penthouse units. Site work began in October. Construction is slated to take 24 months.
Fremont Investment & Loan regional manager Nancy Sulse tells GlobeSt.com it is providing the developer a three-year variable rate loan for the project. Sulse says she is comfortable with the loan given the design, the development team and project's infill location in the already established Folsom Corridor.
The financing is the fourth loan Fremont Investment & Loan has funded for affiliates of Lennar. In addition, Sulse says the location puts the property near Interstate 80 and within walking distance of Westfield San Francisco Center, the Financial District and SBC Park.
Typical pricing for residential condominium projects right now ranges between 300 and 350 basis points over either the one-, three- or six-month Libor, according to local lenders.
The loan has holdbacks for construction, interest reserves and carrying costs (including HOA fees). The funds will be doled out monthly through Fremont Investment & Loan's asset management and construction management divisions.
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