Advanced Real Estate Services, Inc., has refinanced a multi-family portfolio of six properties and 1,223 units in Southern California with $ 240.4 million in loans from Freddie Mac and Fannie Mae arranged by NorthMarq. The financings have generated more than $ 100 million in exit proceeds that will be used as an initial investment in the $ 250 million 20-1 advance fund for new multi-family acquisitions.
Three of the properties are located in Orange County, two in Riverside County and one in Los Angeles County, according to Michael Elmore, executive vice president / general manager of NorthMarq’s office in Newport Beach, Calif., Who managed the refinancing transactions. Elmore said in a prepared statement that Freddie Mac funded the first five assets for $ 204.6 million during the initial phase of the COVID-19 crisis and kept all financial terms unchanged.
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Pacific Palms Apartment Homes, a two-building, 149-unit property located at 111 W. Orangewood Ave. and at 2045 S. Haster St. in Anaheim, Calif., was refinanced with a $ 35.9 million 10-year loan at an interest rate of 2.71% by Fannie Mae further into the crisis. According to Elmore, Fannie Mae also held all of the terms and conditions, noting that both lenders have long-term relationships with Advanced.
Advanced Real Estate Services has been successful in securing attractive financing during the peak of the pandemic. Richard Julian, the president of the company, attributed this success to his relationships with NorthMarq, Fannie Mae and Freddie Mac. In prepared remarks, he noted that Advanced already had three new properties in escrow that had been bought off-market and was aggressively seeking more assets.
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All remaining assets were funded by Freddie Mac and received 10-year loans with only five years of interest, followed by a 30-year amortization schedule. Interest rates were stuck at 2.84 percent. The assets are:
- Corona Pointe Resort, a 714-unit property at 3957 Pierce St. in Riverside, Calif. That was refinanced with a $ 121 million loan
- Corona Pointe Townhomes, a 63 unit property at 11511 Magnolia Ave. to Riverside which was refinanced with a $ 14.3 million loan
- The 5800 Apartment Homes, a 149-unit property located at 5800 South St. in Lakewood, Calif., Which was refinanced with a $ 35.6 million loan
- Avignon Apartment Homes, a three-part building comprising 88 units at 1361 and 1375 West Valencia Drive and 220 Basque Ave. in Fullerton, Calif., which was refinanced with a $ 19.8 million loan
- Washington Place, a 60-unit property located at 1311 E. Washington St. in Santa Ana, California, which was refinanced with a $ 14 million loan.
In June 2019, NorthMarq’s Elmore arranged the refinancing of another Advanced Southern California property, securing a $ 56 million permanent loan from Freddie Mac for the 320 Highland Pinetree apartments in Fullerton. The transaction provided $ 28 million in net cash to be used for further acquisitions.
Founded in 1982, the Irvine, California-based company finances all of its investments with private capital, manages renovations in-house and manages properties. The company owns and operates more than 9,000 multi-family housing units in Southern California.