Target Builders has received a $43.8 million construction loan and permanent financing for the development of The Reserves at San Marcos, a 376-unit partially affordable project in San Marcos, Texas. Working on behalf of the borrower, KeyBank Real Estate Capital secured the Freddie Mac financing. With Northfield Design Associates as architect, the $55.6 million project is slated for a 2022 completion.
The fixed-rate financing consists of a $41 million tax-exempt loan with a $2.8 million taxable tail. After the forward-commitment period of 36 months, the permanent loan will carry a 15-year term with a 35-year amortization schedule. CREA LLC also syndicated 4 percent lower-income housing tax credits. As part of the funding structure, KBREC’s Community Development Lending and Investment team purchased the private activity tax-exempt bonds.
The Reserves at San Marcos will come online on 21 acres at the intersection of State Highway 123 and Rattler Road. Upon completion, the community will feature 298 units set aside for tenants earning up to 60 percent of the area’s median income and 78 market-rate apartments. Of the total, 28 units will be accessible to disabled residents. The apartment mix will include one- to four-bedroom floorplans ranging from 650 to 1,350 square feet.
The development site is some 5 miles from downtown San Marcos, just south of Rattler Stadium. The property is also 3 miles south of another affordable development that recently received $50 million in financing.
KBREC’s Robbie Lynn of the Commercial Mortgage Group and Hector Zuniga of the CDLI team structured the financing for The Reserves.