The Bascom Group Completes $235 Million Refinance of Eleven-Property Multifamily Portfolio

IRVINE, CA - The Bascom Group has successfully completed a $235 million refinance of an 11-property multifamily portfolio spanning five states. All of the properties are part of Bascom's third fully discretionary fund, Bascom Value Added Apartment Investors III, LLC. Most of the new loans are interest-only with spreads over LIBOR ranging from 180 bps to 200 bps and interest only periods of 24-36 months.  The refinanced properties include The Square Apartments in Downey, CA, Camden Village Apartments in Fremont, CA, Del Flora Apartments in Redlands, CA, Courtyard on 68th Apartments in San Diego, Juniper Terrace Apartments in Escondido, CA, Southtown at Main Apartments in Santa Ana, CA, 52nd Marketplace in Arvada, CO, Prescott Lakes Senior Apartments in Prescott, AZ, McKinney Orchid Apartments in McKinney, TX, Fifty 101 and Lyric Apartments, both in Las Vegas, NV.

Bascom worked with several capital market partners and lenders to complete the refinancing. Brian Eisendrath and Annie Rice from CBRE, Charles Halladay and Jamie Kline from JLL, and Tom Sherlock and Erich Pryor from Talonvest arranged the debt financing. Five loans were provided by Comerica Bank, two from Silvergate Bank, and one loan each from TCF Bank, New York Life, Citizens Business Bank, and Texas Capital Bank. The refinance produced over $39 million in additional loan proceeds, a 76 bp reduction in overall interest rate spreads, and 16% decrease in portfolio debt service payments. 

"Overall, the refinances have dramatically improved the debt structure for our entire portfolio," said Bascom's Senior Principal, Chad Sanderson. "Over that past seven months, we have seen a tremendous shift in the capital markets. Both interest rate spreads and the indices have moved dramatically lower. This change allowed us to cash out a significant portion of equity, yet still improve our projected cash-on-cash returns."

"In addition to preserving several key current lender relationships, the recent refinances have provided us with several new lending relationships that we look forward to strengthening over the long-term," adds Lee Nguyen, Senior Vice President Operations for Bascom. "Additionally, with the debt portion of the capital stack addressed, we can direct our attention to our constant goal of improving operations and sourcing new acquisitions."

James D'Argenio, Senior Principal, comments, "Our lending partners at Comerica, Silvergate, TCF Bank, New York Life, Citizens Business Bank, and Texas Capital Bank enabled us to extend our debt term with minimal upfront costs, as well as preserve maximum flexibility to sell the assets with little to no prepayment penalties or lockout periods. We believe these favorable terms will allow us to continue maximizing value for our investors."