Greystone Monticello Arranges Green Loan for Indiana Student Property

The financing backs a community in Bloomington.

The property is located in Bloomington, Ind., near Indiana University’s flagship campus. Image courtesy of Greystone Monticello

Capital finance provider Greystone Monticello has arranged a $36.3 million bridge loan for a Bloomington, Ind., student housing property. Greystone plans to use an innovative green financing initiative, insured by the U.S. Department of Housing and Urban Development, to transition the property to a permanent exit.

The name of the property could not immediately be learned. Bloomington, Ind., is home to Indiana University Bloomington, a public research university that is the flagship of the Indiana University system.

Flexible term

Financing for the 226-unit student housing community was originated by Michael Zukerman and Adam Lipkin of national commercial real estate finance company Greystone. There were several challenges to arranging the bridge financing, including the Greystone Monticello team’s need to meet or exceed the sponsor’s objectives given the state of the capital markets. Those objectives included providing time for the sponsors to execute their business plan, fund significant capital improvements including energy efficiency enhancements, identify a path to a cash-neutral closing and maintain or reduce current rates of interest.

Greystone Monticello’s non-recourse bridge-to-HUD-insured green permanent financing, which featured HUD-insured financing from Greystone, was able to meet the sponsor’s objectives, including attaining a flexible term with appealing prepayment options, achieving a cash-neutral closing which included a cash-out to pay for interest rate cap and other costs and funding more than $1 million in capital expenditures, as well as reducing current-pay interest expense.

The Greystone Monticello joint venture furnishes a broad array of bridge financing options in the multifamily and senior housing sectors.

Indiana University Bloomington is considered one of the top U.S. university markets for student housing development.

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