OMAHA-Northmarq Capital says it has used a new long-term secured debt financing facility with Freddie Mac, the tax-exempt bond securitization program, to arrange $95.81 million for America First Tax Exempt Investors LP, a multifamily owner based here. The portfolio is secured by 15 properties in 14 states.
The borrower is using about $50 million to repay an outstanding balance on the firm’s securted term loan with Bank of America. After the repayment, and the payment of expenses, about $40.9 million of net proceeds were received by the company, says John Reed with Northmarq.
The Bank of America term loan facility, which was to expire on Dec. 31, was retired and replaced with a long-term financing, addressing refinancing risks associated with the Bank of America loan. The company's cost of borrowing was reduced from an effective rate of approximately 4.25% on the retired Bank of America loan to an initial rate of approximately 2.15% on the TEBS financing.
The program is a great way for tax-exempt bond managers to leverage their portfolio, Reed tells GlobeSt.com. “It’s a great time to do these deals, because rates are so low,” Reed says.
The properties have about 2,500 units. These apartment sites include The Mill Apartments in Des Moines, IA; Bella Vista Apartments in Cooke County, TX; Bent Tree Apartments in Columbia, SC; Bridle Ridge in Greer, SC; Brookstone in Waukegan, IL; Crescent Village in West Chester, OH; Cross Creek Apartments in Beaufort, SC, Fairmont Oaks in Gainesville, FL; Lake Forest in Daytona Beach, FL; Post Woods in Reynoldsburg, OH; Runnymede in Travis County, TX; Southpark in Austin, TX; the Villages at Lost Creek in San Antonio, TX; Willow Bend in Hilliard, OH and Woodlynn Village in Maplewood, MN.
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