GlobeSt.com UPDATE: Bulls Capital Funds Rreef's $132M Apartment Deal

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SMYRNA, GA-Bulls Capital Partners LLC of Vienna, VA has closed an $85.5-million acquisition loan to San Francisco-based Rreef America LLC which paid locally based Post Properties Inc. $132.5 million, or $76,237 per unit, for the five-community, 1,738-unit Post Village Apartments in this suburban city. GlobeSt.com previously reported the Aug. 8 property sale closing. Paul Berry of CB Richard Ellis Inc. represented Rreef in that transaction.

The loan is secured by the property, Bulls president and CEO Herman Bulls says in a prepared statement. Bulls says his firm underwrote, closed and funded the complex transaction in 45 days. The acquisition was funded through Rreef’s assumption of three existing tax-exempt bonds totaling $47.5 million and the issuance of a new $38-million taxable loan, structured as a Fannie Mae ARM.

Andrew C. Ellis, vice president of production at Bulls Capital Partners, tells GlobeSt.com “the loan was in two pieces–assumption of a tax exempt bond credit enhancement facility for $47.5 million with a term of approximately 20 years and an initial pay rate of 3.375%, and a new taxable, cash, ARM mortgage for $38 million with an initial pay rate of 4.29% with a term of seven years.”

Ellis says the tax exempt component of the loan is based on seven-day variable rate bonds and is interest-only for 10 years. The taxable ARM mortgage is interest only for the full term, with an interest rate of 4.29%, adjusted very 30 days based on Libor. The overall loan-to-value factor is 62.7%.

Rreef bought Post Village for an undisclosed institutional client. The property is being renamed the Village of Lake Park. Sun Trust Capital Markets, a loan correspondent and joint venture partner of Bulls Capital Partners, originated the loan. SunTrust managing director Hank Harris coordinated the transaction.

Competition to finance the deal was fierce, says Mark Van Kirk, co-founder and chief financial officer of Bulls Capital Partners. He calls the current commercial real estate lending arena a “highly competitive environment.”

Post Village includes the Arbors of Post Village, the Hills of Post Village, the Gardens of Post Village, the Fountains of Post Village and the Meadows of Post Village. The community was completed in phases between 1983 and 1988 and was 93% occupied at closing.