Hunt Mortgage Group has furnished an $11.5 million Fannie Mae loan to refinance Alexander Pointe Apartments, a 120-unit garden-style multifamily property in Mebane, N.C. The borrower is Sovereign Development Company LLC, and the property 100-percent owned by Jim Kitchen, who purchased the apartment community during its lease-up phase. The property was purchased for $14.8 million, with the help of an $11.5 million loan from the Bank of North Carolina.
The two-year-old community consists of five three-story residential structures. Its units average 1,100 square feet in size. Unit features and finishes include wood cabinets, granite countertops and plank flooring in kitchens. Bathrooms feature wood cabinets, granite counters, built-in porcelain sinks, vanity mirrors and ceramic tile flooring. Washer-dryers and private balconies or patios are part of each residence. Amenities include a swimming pool, business center, clubhouse, fitness center, putting green and dog park.
The community is situated northwest of Durham, N.C., and it is conveniently located to the Tanger Shopping Outlets.
“When the borrower purchased the property the occupancy was poor, as it was badly marketed and tenant screening was poor,” Hunt Mortgage Group managing director Bryan Cullen told MHN.
“Hunt Mortgage Group worked with the Bank of North Carolina, where they provided a short-term loan to facilitate the acquisition while we awaited the necessary collections to support our permanent loan. We were able to lock the rate once they achieved the required income.”
Kathy Anderson placed the bridge loan and negotiated for the permanent loan with Hunt Mortgage Group. “When we acquired the property, we had to rectify some tenant and marketing issues related to the previous owner,” Kitchen said.
“Our fee manager, Apartment Dynamics, helped us move the occupancy from 70 percent in the summer to nearly fully occupied in October, with no concessions. Hunt was able to increase our loan dollars by over $50,000 after rate lock by identifying savings in the insurance premium. Overall, they did a wonderful job, and delivered as promised.”
Hunt Mortgage Group’s loan was debt service constrained at just under 80 percent of Kitchen’s acquisition cost but wound up 70 percent of the fully stabilized appraisal amount, according to Bryan Cullen, Hunt Mortgage Group managing director.