Hunt Real Estate Capital announced today it provided a Fannie Mae affordable multifamily loan in the amount of $64.14 million to finance the acquisition and renovation of an affordable multifamily property located in San Pedro, California.
Park Western Apartments is a 216-unit property that is comprised of fourteen residential buildings that were built in 1969. The property is located on a 7.72-acre site at 1327 West Park Western Drive and contains 32 one-bedroom units, 128 two-bedroom apartments, 32 three-bedroom units, 24 four-bedroom apartments, and a 1,300-square-foot maintenance shop.
The Fannie Mae M.TEB loan has a 17-year term, 40-year amortization, and provides significantly greater loan proceeds to support a substantial rehab budget. According to RBC Capital Markets, this was the second largest Fannie M.TEB loan made and featured the lowest rate closed in the program since 2016.
The borrower is Park Western Housing, LP, an entity formed to acquire, renovate, and manage the property. The deal is backed by Richard Siebert and June Park of SDG Housing Partners, along with their nonprofit partner, Affordable Housing Access. Hunt Real Estate Capital’s Aaron Wooler and John McAlister, Managing Directors in the firm’s Arcadia, California office, worked to place this financing.
“The borrower originally acquired Park Western Estates in March of this year through Hunt and Century bridge loans that were closed within three weeks to meet the seller’s closing deadline,” noted Hunt’s Aaron Wooler. “With this new permanent financing and tax credit equity, SDG Housing Partners will be able to preserve an at-risk affordable multifamily development that the residents of Los Angeles cannot afford to lose.”
The renovation plan includes work to the building exteriors, roofs, and mechanical, electrical, and plumbing systems, as well as upgrades to unit interiors, including both common area and apartment upgrades. Upgrades will also include landscaping, improvements to the driveway entry, installation of a dog run, new and updated site lighting, tot lot/playground reconfiguration, the addition of a sitting area, and installation of a pergola at the barbecue area.
Current property amenities include a courtyard, on-site management, central laundry facilities, playground, garage parking and picnic/barbecue area, as well as surface and covered parking. Upon completion of the renovation, additional amenities will include an exercise facility and community room. Renovations are expected to be completed within 14 months.
“With schools, health care, public uses, retail, and transit access all within 1.6 miles of the community, Park Western Estates is located in a neighborhood that is well suited for affordable multifamily development,” added Wooler. “This project’s financing also has special meaning to me, as it was the last deal that John McAlister and I worked on prior to his passing. It was fitting that his storied career ended with such an impactful deal.”
San Pedro, California is located in Los Angeles County, within the Los Angeles-Long Beach-Anaheim, MSA, and the property is in a neighborhood in the southern portion of Los Angeles. The local area is surrounded by Palos Verdes Drive North to the north, the Port of Los Angeles to the east, the Pacific Ocean to the south, and the city of Rancho Palos Verdes to the west.