DENVER, CO – Holliday Fenoglio Fowler, L.P. (HFF) announces financing totaling $172.845 million for five apartment communities comprising 1,534 units in the Denver and Houston metropolitan areas.
The HFF team worked on behalf of the borrower, Advenir, Inc., to secure the seven-year, fixed-rate loans in five separate transactions through Freddie Mac’s CME Program. The securitized loans were used to refinance existing floating-rate debt on the properties, and will be serviced by HFF, a Freddie Mac Multifamily Approved Seller/Servicer for Conventional Loans. HFF worked with the borrower in a strategy to mitigate interest-rate risk amid the current rising rate environment. The average rate across the five fixed-rate loans is 4.27 percent with rates spanning from 4.21 to 4.34 percent. The average rate at the retirement of the LIBOR-based, floating-rate loans was 4.47 percent with rates spanning from 4.26 to 4.86 percent. The fixed-rate conversions took the ongoing LIBOR adjustment risk off the table and ultimately provided the borrower with a reduction in the all-in rate for each property with additional interest-only amortization.
“We have found this to be an opportunistic time to lock interest rates with fixed-rate loans for stable properties that exhibit a long-term ownership horizon,” said Stephen L. Vecchitto, managing director and principal of Advenir, Inc. “These properties provide substantial current cash flow and continued market appreciation. While the original floating-rate debt allowed for the execution of the value-add business plan upon acquisition, the new fixed-rate debt allows for interest rate stability and a longer hold timeframe for the asset.”
The properties in the portfolio are: Advenir at Eagle Creek, a 258-unit property located at 10373 North Sam Houston Parkway East in Humble, Texas; Advenir at Woodbridge Reserve, a 288-unit property located at 15000 W. Airport Boulevard in Sugar Land, Texas; Advenir at Cherry Creek North, a 345-unit property located at 1090 S. Parker Road in Denver, Colorado; Advenir at Cherry Creek South, a 292-unit property located at 1211 S. Quebec Way in Denver, Colorado; and Advenir at Del Arte, a 351-unit property located at 151 S. Joliet Circle in Aurora, Colorado. The portfolio is 94.57 percent occupied overall.
The HFF team representing the borrower included senior managing director Eric Tupler and managing directors Josh Simon and Cortney Cole.
About Advenir, Inc. Founded in 1996, Advenir, LLC is a Real Estate Investment Company headquartered in Aventura, Florida (Miami-Dade). Advenir acquires and operates multi-family rental communities throughout the United States, on behalf of high-net-worth and institutional investors. Since inception, Advenir has owned and operated more than 23,000 apartment units valued at just under $3.7 billion. The company’s current portfolio is in excess of 13,241 apartment units valued at more than $2.3 billion. In addition to Advenir, LLC, Advenir has a Property Management Company with 325 employees and regional offices in Florida, Texas, Colorado and Louisiana; and a Construction Management Company focused on multifamily development and rehabilitation.
About HFF: HFF and its affiliates operate out of 26 offices and are a leading provider of commercial real estate and capital markets services to the global commercial real estate industry. HFF, together with its affiliates, offers clients a fully integrated capital markets platform, including debt placement, investment advisory, equity placement, funds marketing, M&A and corporate advisory, loan sales and loan servicing. HFF, HFF Real Estate Limited, HFF Securities L.P. and HFF Securities Limited are owned by HFF, Inc. (NYSE: HF). For more information, please visit hfflp.com or follow HFF on Twitter @HFF.