DALLAS-Local developer Merriman Associates has secured financing for the $28-million conversion of the historic Interurban Building, which served as the terminal for North Texas’ vast electric railway system, into a class A, residential high-rise.

Merriman Associates’ principals Chip Johnson, Craig MacKenzie and Randy Rost mined several financing sources, including a $5 million TIF grant from the city and $3.3 million in federal historic tax credits, says Bernard P. “Bud” Malone, president of Malone Mortgage Co. “This was a complex transaction,” he says.

Dallas-based Malone Mortgage provided $18.2 million in construction and permanent financing for the Interurban project through HUD’s 220 full-insurance Multifamily Accelerated Processing program. The 40-year loan fully amortizes over the term. Malone tells GlobeSt.com that the 18-month construction loan has an interest rate of 5.75%, which rolls into a 5.5% permanent loan. In addition to the first mortgage, Merriman Associates obtained a $1.5-million mezzanine loan from New York City-based New York Life Insurance Co.

Located at 1500 Jackson St. in Dallas’ CBD, the 165,000-sf Interurban Building was built in 1916. The redevelopment calls for a ninth floor to be added to the building so it can be outfitted with 134 lofts, ranging from 669 sf to 1,638 sf. The average unit will be 827 sf. Rents will range from $700 to $1,700 per month. The project also will include a six-level parking garage with 450 spaces and a 20,000-sf, full-service grocery store. Construction began a month ago. Units will start to turn in September 2005.

Malone Mortgage has provided financing for several historic redevelopments. Its notable projects are the conversions of the Kirby Building , built in 1913, and the Santa Fe Terminal Lofts, circa 1920s, and San Antonio’s Cadillac building in the CBD.

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