Capital One Provides $134M to Refi 25 Boston Multifamily Properties

BOSTON—Capital One Multifamily Finance of Bethesda, MD reports it has provided 19 Freddie Mac fixed-rate loans totaling $134.4 million for the Fineberg Companies of Wellesley, MA to refinance a portfolio of 25 multifamily properties, all located within the Boston region.

The three largest of the 19 transactions were: a $21.2-million loan for a group of four properties on Chiswick Road and Commonwealth Avenue; a $19.9-million loan for four adjacent midrise apartment buildings at 1163 to 1175 Boylston St.; and a $17.4-million loan for three adjacent buildings nearby, at 1179 to 1191 Boylston Street.

The fixed-rate loans have a 10-year term, 10 years of interest-only payments; 9.75 years of yield maintenance, and 30-years amortization payable on an actual/360 basis, Capital One states in its announcement.

The transaction was originated by Senior Vice President of Originations Michael Edelman, who oversees Capital One Multifamily's Northeast region production from the firm's New York office. The sponsor was the Fineberg Companies, a long-term owner of multifamily, retail, and office properties, primarily in the Boston area.

By working closely with Freddie Mac, Capital One was able to structure the transactions to maximize the sponsor's cash-out and minimize its carrying costs going forward. A key advantage was the sponsor's goal of refinancing approximately $100 million of Freddie Mac debt set to mature in June and July 2015. Freddie Mac agreed to waive a portion of the prepayment premium, and by allowing the sponsor to take advantage of the agency's extended early rate lock program, the prepayment penalty was further reduced, Capital One officials state.

“Our close working relationship with Freddie Mac helped the deal go smoothly,” Edelman says, “but the agency was also highly motivated to retain the Fineberg Companies as a customer. They have owned many of these apartments for 40 years, building up a substantial amount of equity.”