Red Capital Arranges Loan for Historic PA Conversion
The $7.8 million financing will be used to transform a century-old tobacco warehouse in Lancaster County into Tobacco Road Apartments.
Red Capital Group LLC (RED) has arranged a $7.8 million construction loan for the adaptive reuse of an historic Landisville, Pa., building. The loan will be used to develop a currently vacant brick warehouse into Tobacco Road Apartments, helping meet a significant need in the Lancaster County region for market-rate rental housing.
The historic building was once a tobacco warehouse featuring four connected buildings. Built in the early 20th Century, it is on the National Register of Historic Places. As part of the redevelopment, wood floors and exposed wooden beams will be refinished in some areas.
The 66 one-, two- and three-bedroom units will be developed by S.B. Conrad. Tobacco Road Apartments will also feature an elevator, lounge and fitness center, among other amenities.
“We identified this project as a regional opportunity,” said David Bonomo, director at Red Capital Group, in a prepared statement. “We directed our efforts toward local community lenders, and we are very pleased with the results.”
“Tobacco Road will provide high-quality rental apartments in the Lancaster area marketplace, where the demand exceeds the supply,” said Steve Conrad, president of S.B. Conrad, in prepared remarks. “To do so while preserving such a meaningful local real estate asset makes it even more rewarding.
“(RED) managed the financial side of the equation, allowing us to focus on what we do best: development. RED targeted the appropriate segment of construction lenders, delivered a term sheet in a matter of days and positioned us to close within a few weeks.”
Red Capital Group acted as exclusive structuring agent, managing the solicitation effort on behalf of S.B. Conrad. The team negotiated favorable pre-payment provisions, which will allow Conrad to refinance the bank loan within two years with no prepayment penalty.
Image courtesy of RED