Don't Miss a Fact,
Sign Up for FINfacts!

FINfacts is a weekly newsletter highlighting recent financings and economic insights.

Subscribe Here

$23,000,000 Construction Financing and $9,800,000 Equity Placement for 108-Unit Build-to-Rent Community; Charlotte, NC

Rate: SOFR + 5.50%
Term: 3 Years
LTC: 70%
Fee: 1.25%
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners successfully advised on $23,000,000 in construction financing and $9,800,000 in JV Equity for the development of a 108-unit built-to-rent community in Charlotte, NC. The Project features 108 attached single-family homes situated atop a 13.5-acre site. The Site is located just seven miles outside of downtown Charlotte and less than 2 miles from UNC Charlotte. The houses have private entrances, individual backyards and feature shared amenities including a pool, jacuzzi, clubhouse, fitness facility, grilling area, pet park, and game room.

GSP worked through several strategies with the Sponsor to source the non-recourse financing terms and joint-venture equity partner for the ground-up built-to-rent community. The Sponsor chose a joint-venture partner that GSP had introduced to the sponsors on a previous deal. GSP sourced several highly reliable lender options, and the Sponsor ultimately went with a lender headquartered in Charlotte that provided strong terms and would keep the loan on their balance sheet.

The Sponsor projects vertical development to be completed by late 2023 and lease-up to be finalized by Q2 2024.

Advisors

Related Financings

  • $46,800,000 Construction Financing for the Development of a 247-Unit Build-to-Rent Community; Foley, AL

    November 21, 2022

    Transaction Description:

    George Smith Partners is pleased to announce the successful arrangement of a $46,800,000 construction loan for the development of a 247-unit build-to-rent community in Foley, Alabama. Through GSP’s strong relationship with the bank, GSP was able to successfully negotiate a 65% LTC, Non-recourse loan to fund parri-passu with the JV’s equity at WSJ Prime + 1.25% through construction. Pricing reduces and leverage increases to 70% LTC upon preset leasing hurdles.

    Rate: Prime + 1.25%
    LTC: 65%
    Guaranty: Non-Recourse

  • $47,500,000 Construction Financing for a Ground-Up, Single-Family Build-to-Rent Development; La Quinta, CA

    January 26, 2022

    Transaction Description:

    George Smith Partners arranged $47,500,000 in construction financing for the development of a single-family build-to-rent community in La Quinta, within Southern California’s Coachella Valley on behalf of Shopoff Realty Investments. Spanning 18 acres, the Project features 131 units, averaging approximately 2,000 SF per unit. The Sponsor completed entitlements on the infill site over the last few years and secured the financing to commence construction.

    Build-to-rent communities have gained significant traction due to, on average, high absorption rates and attractive rental premiums over comparative products. Demand has grown significantly, making it the fastest growing asset class in the U.S. housing market. The Sponsor, a best-in-class developer based in Southern California, recognized the opportunity to capitalize on the booming asset class. GSP was able to identify a lender who understood the investment potential of the high-growth submarket, as well as the Sponsor’s strong local knowledge and expertise in the BTR industry.

    All Terms Confidential

  • $26,000,000 Total Construction, LP Equity, & Co-GP Platform Advisory, SFR for Rent; Fort Meyers, Florida

    August 18, 2021

    Transaction Description:

    As the leader in the rapidly emerging Single Family for Rent (SFR for Rent) and Build-to-Rent (BTR) multifamily asset classes, George Smith Partners worked with our client to structure an optimal structure for the development of the 130-unit project located in Fort Meyers, FL. Throughout the year-long engagement, GSP and the Sponsorship secured various investment structures including multiple Co-GP, LP, Pref, and Senior construction facilities, ultimately structuring a high leverage 70% recourse loan and a full equity structure of 80% LP + 20% Co-GP.

    With the intention of securing platform participants, the chosen structure will allow for a rapid expansion of the portfolio on a favorable deal by deal basis. The Sponsorship plans to scale with their partners to an additional 600 units in the next 12 months to meet the rapidly growing need for housing across Florida. The platform investment will also provide the opportunity to grow into other high growth markets across the south and east coasts.

    SENIOR DEBT
    Rate: 3.75%
    Term: 4 years
    LTC: 70%
    Guaranty: Recourse

    EQUITY
    80% JV & 20% Co-GP Equity

  • $18,600,000 Construction Financing for 109-Unit SFR Construction in an Opportunity Zone; Phoenix, AZ

    August 11, 2021

    Transaction Description:

    George Smith Partners successfully advised on $18,600,000 in construction financing for a 109-unit build-to-rent and Opportunity Zone transaction in Phoenix, AZ. This follows on the successful $7,100,000 JV equity financing GSP advised on. This single family for rent community will offer one, two and three-bedroom detached homes with upscale furnishings and private yards for most units. The Sponsor has five more transactions under contract. This was the first transaction for our Sponsor who is optimistic about the popularity and emerging trend of the build-to-rent niche.

    Terms Confidential

  • $7,100,000 JV Equity Financing for 109-Unit SFR Construction in an Opportunity Zone; Phoenix, AZ

    March 31, 2021

    Transaction Description:

    George Smith Partners successfully advised on $7,100,000 in joint venture equity financing for a 109-unit build-to-rent and Opportunity Zone transaction in Phoenix, AZ. This single family for rent community will offer one, two and three-bedroom detached homes with upscale furnishings and private yards for most units. This was the first transaction for our Sponsor who is optimistic about the popularity and emerging trend of the build-to-rent niche.

    All Terms Confidential