SAN ANTONIO-Five years after acquiring a 942-unit multifamily propertyportfolio and accompanying assumable mortgage, ownerPartnered Property Acquisitions Group LLC obtained a $39.2 million loan to refinance the collection. Beech Street Capital LLC helped out,working with Freddie Mac to execute three 10-year,fixed-rate loans on the 466-unit Sunset Canyon Apartments; the244-unit Kenton Apartments and the 232-unit Peppermill.

According to Beech Street vice president BrianSykes, the liaison between Freddie Mac and the borrower,obtaining the loans was a challenge, not the least of which wasmaturity timing, foundation issues and working with differentequity partners. The loan was used to pay off an existing blanketfor the first mortgage; PPA also wanted the proceeds to cover themezzanine debt and close the loan without funds coming out ofpocket.

"We took advantage of the uptick in valuations in the SanAntonio market and worked closely with the appraisal district,"Sykes adds. "We ended up with $1 million more in proceeds than whenwe'd originally signed on, which made this a cash-neutraltransaction." Furthermore, Beech Street helped PPA rate lock 30basis points lower than initially anticipated.