Colliers Arranges Construction Loan for LA Project
The 100 percent affordable community will be situated in Koreatown.
The Structured Finance Group at Colliers Mortgage in Los Angeles has arranged $24.4 million in construction financing backing a 100 percent affordable apartment community in the city’s Koreatown neighborhood.
The 136-unit multifamily property, Kingsley Apartments, is situated just three blocks from Metro D-Line’s Wilshire and Normandie Station in the heart of Koreatown, one of L.A.’s most walkable neighborhoods. Upon completion, the 72,800-square-foot community will feature a blend of studio and one-bedroom units, with rents at 80 percent AMI.
The financing was arranged by Jonathan Lee and Shahin Yazdi, executive managing directors of the Structured Finance Group, and their team. The financing features a term of 30 months, plus optional extensions and carries a rate of SOFR plus 2.41 percent.
The project is part of a new pro-affordable housing program, Executive Directive 1, known as ED, which was instituted by Los Angeles Mayor Karen Bass. the sponsor intends to break ground this month, just seven months after development plans were filed.
New initiative
“The biggest challenge we faced is that ED 1, despite being on the books for over a year, is still a relatively new initiative to the lending community,” Lee told Multi-Housing News. “Some very active construction lenders are being judicious and have taken a ‘wait and see’ approach to these deals out of an abundance of caution. Or they have chosen to mitigate that risk with lower leverage.”
“Not only was the leverage 75 percent LTC, but this loan size exceeded all new relationships for this lender because of the strength we were able to establish with them for ED 1 projects,” said Lee.
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