INDIANAPOLIS, IN-Gibraltar Properties has closed on three permanent, fixed-rate loans totaling $49.95-million to pay off the construction financing for three apartment projects in Nebraska and Indiana totaling 901 units. The lender was TIAA-CREF, a life company and pension fund.

Gibraltar is a closely-held real estate holding company based in Indiana. It oversees the acquisition, development, financing and management of 22 multifamily, office, retail and special-use properties located primarily in Indiana.

The 10-year, fixed-rate financing had an 80% loan-to-value ratio and included an interest-only provision for the initial period of the loan. For an 80% loan, the current spread is 135- to 150 basis points above the treasury.

With occupancies between 75% and 85% at closing, none of the properties had yet stabilized. So to qualify them for a loan and capture a low interest rate at this more risky stage, the loans were cross collateralized, says David Keller, the senior managing director at Holiday Fenoglio Fowler. Keller arranged the transaction with partner Jon Wood.

“It gives the lender confidence through diversification,” Keller tells “If one of the properties doesn’t perform as quickly, the strength of the other two could support the one.”

The largest of the three properties is Overlook Apartments in Omaha, NE, a garden-style development that has 330 units in fifteen three-story buildings situated on about 20 acres. The two-phase development was completed in November 2001.

The 304-units Settlers Run Apartments in Indianapolis, IN were developed in three phases, the last of which was completed this past January. The property has 26 apartment buildings on about 29 acres.

Reserve at Dawson Creek in Fort Wayne, IN has 274-units in 24 apartment buildings on 27.5 acres that also holds a clubhouse, pool and tennis courts. The development was completed in late 2001.

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