INSIDE THE DEAL: Walker & Dunlop Makes $53M Acquisition Loan for Property in Florida

By Keat Foong, Executive EditorSebring, Fla.—Is you asset located in a Fannie Mae “pre-review state”? Here is one property that is, but it was in a very good position to obtain financing.   Walker & Dunlop provided Tanglewood Manufactured Housing Community with a $53 million acquisition loan under the Fannie Mae DUS program. The 10-year fixed-rate loan is interest-only for the first two years. According to Will Baker, vice president, Multifamily Finance, at Walker & Dunlop, the lender normally makes loans to manufactured housing that are not less than three to five stars, and Tanglewood was a five-star property. “This is one of the nicest manufactured housing parks we have ever seen,” he says. The property is chock-full of amenities, and occupancy was at 99.1 percent at closing. “We have seen strong rent growth and very few badly performing loans in manufactured home parks. With the exception of Michigan, our portfolio for manufactured communities is dong very well, even in Florida,” comments Baker.  The fact that Tanglewood is an age-restricted (55 years-plus) community is also seen favorably by the lender. Age-restricted parks are perceived as being more stable and insulated than apartments because the residents are retired, suggests Baker. Baker says Walker & Dunlop examined the property’s trailing 12-month rent collections, as well as its historical expenses to make sure it is in line with the market’s. The lender also wanted to make sure there will be “continuing demand” for the product going forward, and it was satisfied that there is, says Baker. Also, the property lies outside of the flood zone.  Walker & Dunlop says it rate locked within 10 days of receiving the signed application, enabling the borrower to take advantage of the Early Rate Lock feature of the Fannie Mae DUS program shortly before a significant increase in interest rates.The property is located about 90 miles south of Orlando. Amenities include a 24,900 sq. ft. club house with an auditorium, professional kitchen and seating for up to 1,100 people, library, computer lab, laundry center, two card rooms and an arts and crafts/meeting room with separate kitchen.The recreation hall includes a fitness center, billiard and table tennis room, large screened-in porch and large multi-purpose room. In addition, the property has a large heated swimming pool; tennis, shuffleboard, horseshoe, pentanque and pickleball courts; putting and chipping greens; multiple barbeque areas; and a nature trail. The property’s original owner and developer was close to retiring, and he felt confident selling the manufactured housing park to a reputable buyer, says Baker.