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1/06/17
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Walker & Dunlop Inc has structured a $15 mil refi loan with Freddie Mac for The Harvey, an early 1920s vintage, mid-rise multifamily building in Los Angeles. The 57.7k sf property consists of four stories with street accessible retail shops on the first floor and 178 apartment units on the additional three levels.
Located just west of the 101 Fwy, along Santa Monica Blvd in eastern Hollywood, The Harvey fills a gap in the area’s housing market by offering an affordable living option for local service and entertainment industry workers, in an area that is saturated with luxury living options. The property is situated just a short walk to Paramount Studios.
The rent-controlled property qualified as 100 percent “affordable” by Freddie Mac’s metrics, which provides cost-effective rents for moderate- and low-income tenants in this high cost area. As a result, Walker & Dunlop could provide aggressive financing in the form of overall loan proceeds and a lower rate.
The loan was structured as a seven-year, adjustable-rate mortgage with two years of interest-only payments, followed by a 30-year amortization schedule. Walker & Dunlop’s Mark Plenge structured the deal.
In the first year of ownership, the client made interior renovations and exterior restorations, which enabled the loan to recapitalize over 90 percent of the owner’s basis in the property. Last month, the mayor of Los Angeles publicly recognized the property’s sponsors for their proactive and thorough renovations to another one of their rent-controlled assets in nearby Echo Park.
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