Brookfield and Fairfield Close $323M Fund

Brookfield Asset Management and Fairfield Residential close a $323 million value add fund; Beech Street provides a $21.7 million acquisition loan; and Berkadia arranges interim and permanent financing for properties in Brooklyn, N.Y.

Toronto & San Diego—Brookfield Asset Management Inc. and Fairfield Residential Co. have announced the successful final close of the Brookfield Fairfield U.S. Multifamily Value Add Fund with total commitments of $323 million. The fund, which was originally launched with a $250 million target, received strong support from a set of global institutional investors. Brookfield also committed $50 million. The fund is currently 50 percent invested and will pursue undervalued or underperforming multifamily assets in infill or supply-constrained locations.

“We believe that the current environment offers attractive investment opportunities as a result of both a limited new supply of apartment properties and strong potential growth in rental demand in major markets across the United States,” says David Arthur, managing partner at Brookfield Asset Management. “We are confident that the combination of Fairfield’s multifamily expertise and Brookfield’s sponsorship will enable the fund to successfully capitalize these opportunities.”

Beech Street closes $21.7M acquisition loan

Ashley Lake Park

Boynton Beach, Fla.—Beech Street Capital has closed a $21.7 million Freddie Mac CME loan to acquire Ashley Lake Park, a 300-unit apartment complex located in Boynton Beach, Fla. Robbins Property Associates, an owner and operator of 12 multifamily assets in Florida and Maryland, acquired the property and took advantage low interest rates with an early rate lock with Freddie Mac. Mitch Sinberg and Michael Wallace, senior vice presidents in Beech Street’s Fort Lauderdale and Orlando offices, originated the transaction.

Located in the Palm Beach metropolitan statistical area, Ashley Lake Park is approximately 10 minutes from the beach and less than one-half mile from Boynton Beach Boulevard. The 1987-built property is also two miles from Beach Regional Mall. Community amenities include a 24-hour fitness center, a basketball court, two swimming pools with a hot tub, a playground, tennis court, and a Wi-Fi enabled clubhouse.

Berkadia arranges interim, permanent financing for properties in Brooklyn, N.Y.

Brooklyn, N.Y.–The New York office of Berkadia Commercial Mortgage LLC closed four deals totaling $82.4 million in financing for multifamily properties located in Brooklyn, N.Y.

Senior Vice President Stewart Campbell and Vice President Thomas Toland worked with borrower HSD Construction LLC to provide $33 million in financing through Berkadia’s bridge loan program for a multifamily property in Williamsburg. The 12-month, floating rate loan will be used to complete Phase II construction of two seven-story buildings located on N. Ninth Street and N. Tenth Street between Driggs Avenue and Roebling Street. Once construction is completed this fall, the two buildings will house a total of 98 units.

Berkadia worked with the same borrowers on Phase I construction of the property in November 2011, arranging $28 million in interim construction financing through the same bridge lending program for the first 113 units. Then in June 2012, Berkadia secured a $50 million permanent, 10-year Fannie Mae loan upon the project’s completion. The two new buildings in Phase II are currently 95 percent and 80 percent complete and are anticipated to open in September and November, respectively. The first building is already 70 percent leased prior to completion of construction and is expected to be fully leased within a few months of opening.

“For this particular deal, we were able to utilize our in-house bridge loan program to meet the borrower’s needs,” said Campbell. “Our extensive knowledge of the Brooklyn area and capabilities as a one-stop commercial mortgage lender—where we can both stabilize and permanently finance a property—were both very attractive qualities to the borrower.”

Also in Williamsburg, Campbell and Toland worked with sponsor Keap Street Holdings to originate $23 million through Freddie Mac for 65 Ainslie St., a 46-unit apartment community. The 10-year, fixed-rate loan was used to refinance an existing mortgage on the property, which is currently 100 percent occupied.

In addition to the two Williamsburg properties, the duo recently closed loans for multifamily properties elsewhere in Brooklyn. The first was a total of $20.1 million through Fannie Mae for properties located on 182 15th St. and 169 16th St. in Park Slope and the second was a $6.3 million loan through Freddie Mac for 506 Washington Ave. in Clinton Hill. Both 10-year, fixed-rate loans were used to refinance existing mortgages.

“We have worked on a significant number of deals in Brooklyn over the last 18 months,” said Toland. “The borough is a vibrant component of the overall New York City multifamily and commercial market, and we expect the uptick in activity to continue.”