SAN DIEGO (Sept. 29, 2023) — Northmarq’s San Diego team of Aaron Beck, managing director, Wyatt Campbell, vice president and Conor Freeman, vice president, in partnership with Mikee Anderson-Mitterling of Ballast CRE, secured a $46.5 million refinance for Union Apartments, a 170-unit apartment community in Chula Vista, California. The loan was arranged for the borrower through Northmarq’s Fannie Mae DUS platform.
The newly constructed property is well located within a supply-constrained submarket that has strong demand for rental housing. This is evidenced by the overall submarket vacancy rate in the 4% range, among the lowest in the San Diego metro and continued rent growth in the area. The property benefits from a robust local amenity base as well as proximity to regional freeways and Naval Base San Diego. Property highlights include park-like grounds with ample gathering areas to include a pool and spa, clubhouse, playground, barbeque areas and a state-of-the-art fitness center.
“The borrower was able to take advantage of the property’s affordability component and Fannie Mae’s buy-down option in order to lock the interest rate at sub-6%. This lower interest rate allowed for greater loan proceeds and significant interest savings over the term of the loan,” said Beck. “At roughly 60% loan-to-value and a 1.25x debt service cover ratio, the new non-recourse Fannie Mae loan replaced the floating rate construction debt with fixed-rate, full-term interest only payments.”