NorthMarq’s Newport Beach office completes $263 million refinance with Freddie Mac for California portfolio

Advanced Real Estate secures cash-out and decreases debt service 

LOS ANGELES, CALIFORNIA (August 3, 2021) – NorthMarq’s Michael Elmore, Alex Kane, Joe Giordani and Brendan Golding arranged $263 million to refinance six multifamily properties containing 1,255 units located throughout Southern California for Advanced Real Estate, a vertically integrated owner/operator based in Southern California. The individual loans were all structured with a 10-year term, full term interest-only and sized to 65 percent LTV. NorthMarq secured financing for the properties through its Optigo status as a Freddie Mac lender. 

“This refinance is an exciting step in our cycle of purchasing great real estate (apartments in Southern California) renovating, and then refinancing and re-investing those funds. In this pool were properties where we had already completed that cycle multiple times. Those investors still own these assets but now own many other cash-flowing assets as a result. The majority of the proceeds from this pool will be re-invested in our new Advanced Fund 21-2 which kicks off this month. We will also admit into this Fund our private investor network as well as new investors with a goal of raising about $125,000,000. That would be similar in size to the Fund we closed out in August of last year,” said Richard Julian, CEO of Advanced.  

“Freddie Mac was the existing lender and aggressively pursued the portfolio,” said Kane. “They successfully secured pricing waivers, pushed proceeds and waived a prepayment penalty to win the business.” 

The portfolio is comprised of:
- Beachwood Apartments: 2970 W Orange Avenue, Anaheim, CA – 301 Units
- California Palms Apartments: 901 S Harbor Blvd, Santa Ana, CA  – 190 Units
- Countrywood Apartments: 1255 E Citrus Ave, Redlands, CA  – 161 Units
- Crestwood Apartment Homes: 21011 Osterman Rd, Lake Forest, CA – 76 Units
- Sundial Apartments: 2704 W Ball Rd, Anaheim, CA – 106 Units
- Uptown Fullerton: 2656 Associated Rd, Fullerton, CA – 421 Units

The transaction marks nearly $3 billion in closings between NorthMarq and Advanced Real Estate, including the $204 million refinancing last year for a six-property multifamily portfolio located in three California Counties. 

“This financing solution for Advanced—an important long-term relationship -- offered them a substantial cash out while also decreasing their overall debt service even though each loan was separate,” said Elmore.  

NorthMarq’s collaboration with Advanced is on par for the overall greater Los Angeles market. According to NorthMarq’s QI Orange County Market Report, the Orange County multifamily market began this year on an upswing. Deliveries of new units were modest, vacancies ticked lower, and rents rose. Additional improvement is forecast for the remainder of the year as the local economy completely reopens. Check out the full market overview here.