PPD Holdings Eyes $111M to Build, Refi
- Aug 18, 2017
PPD Holdings Investment Group refinanced loans for two of its multifamily properties in Greater Atlanta. The company also received preliminary loan approval for the construction of two apartment communities in southwest Florida. The credit facilities total $111 million.
A $28 million loan on The Crest at Sugarloaf, a 540-unit property in Lawrenceville, Ga., was originated by The Guardian Life Insurance Co. Another $19 million loan were obtained from PPM America for The Crest at Berkeley Lake, a 382-unit apartment community in Duluth, Ga. PPD Holdings is in the process of refinancing The Crest at Laurel Canyon, a 350-unit in Canton, Ga.
Pending construction loans
A $34 million HUD 221(d)(4) loan for the construction of a 200-unit, Class A apartment community in Naples, Fla., is pending approval. The development will be named The Crest at Naples. PPD also anticipates finalizing construction financing for a 264-unit community in Bonita Springs, Fla. It is expected that the $30 million loan will be approved by fall.
Upon completion, both properties will remain part of the PPD Holdings portfolio. These are the first two of the many development projects planned for coastal Florida.
“In all honesty, the hardest part of securing financing was deciding whether to go fixed or floating on the interest rates,” PPD Holdings Partner John Paul Diego told MHN. “Additionally, weighing our options between HUD or conventional financing for new construction took a great deal of planning. Strong relationships with brokers and industry partners generally make for a smooth process during refinancing due diligence and new construction financing. Determining a short- and long-term strategy was the real challenge.”
Flexible financial strategy
As an owner-developer, PPD Holding is flexible when it comes to its financial strategy. “We leaned on industry knowledge from our brokers, industry relationship and management and construction partners to determine our comfort level with current economic trends,” Diego remarked. “In some submarkets, we opted for a short-term strategy favoring conventional financing while in others we opted for a long-term approach with HUD financing, and fixed rate, seven-year refinancing.”
Initially, the company had budgeted for a refinance of The Crest at Laurel Canyon by June 2018, according to Pablo Diego, founder of the company. “But leasing has been extraordinary and has exceeded expectations, so we are positioned to take advantage of refinancing right now,” Diego said.
PPD Holdings doesn’t plan to sell any assets this year, as it focuses on building its portfolio.
Image courtesy of PPD Holdings via crestsugarloaf.com