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1/04/17
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The Vineyards, a 300-unit, Class A apartment community in Colorado Springs, CO, was purchased by a private real estate investment and development company. The transaction was financed with a $41 mil acquisition loan arranged by George Smith Partners.
The Vineyards, located at 4350 Mira Linda Point, consists of 22 buildings featuring a mix of one-, two- and three-bedroom apartments. Several units feature stainless steel appliances, granite-like countertops and contemporary hardware. Residents also have the option of selecting outdoor, covered, or garage parking spaces, and have the ability to rent large, freestanding storage units if needed.
The buyer plans to renovate all units and upgrade the community’s landscaping and on-site amenities, including the clubhouse, fitness center, leasing offices and business center, all of which will support moderate rent growth at the property.
Located on the north side of the city, The Vineyards is in close proximity to several top employers, including St. Francis Medical Center, one of the state’s top hospitals, as well as USAA Financial Center and Lockheed Martin. In addition, the property is surrounded by a variety of shopping and recreation attractions including luxury shopping malls, the nation’s only mountain zoo, and a U.S. Olympic training center.
The financing, arranged by George Smith Partners’ Jonathan Lee and provided by Walker and Dunlop, comprised 75% of the acquisition cost. The non-recourse loan closed at 4.31 percent with a 12-year fixed rate at nine years interest only.
“This structure is rare in the current financing climate. Our client was seeking a long period of interest-only financing, however lenders were initially hesitant to agree to these terms,” Lee says. “By demonstrating the strength of the asset, which is well-positioned as one of the few Class A apartment communities in Northern Colorado Springs, as well as the projected growth in NOI based on the buyer’s plan for the property, we were able to secure financing that met the needs of both the client and the lender. Further, we recommended locking the loan rate prior to the election, which saved our client from a spike in cost when the U.S. Treasury jumped 50 to 60 basis points post-election.”
Jeff Burns of Walker and Dunlop explains, “After reviewing all the materials, we immediately recognized the opportunity in lending on this property. This is a meticulously maintained core-plus asset that is positioned as one of the most high-quality rental properties in the area. With only 600 new units under construction in Colorado Springs, The Vineyards is poised to continue to compete as a top performer in the market.”
Bill Morkes and Craig Stack of Colliers International represented both the buyer and the seller in the transaction.
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