Capital One Closes $29.4 Million Freddie Mac Loan to Refinance Virginia Affordable Housing Community
Capital One announced today that it has provided more than $29 million in financing to Fairfield for the renovation of Grand Oaks Apartment Homes, a 216-unit affordable housing community in Chester, Virginia. The transaction included a new Low Income Housing Tax Credit (LIHTC) allocation and preserves the long term affordability of the property.
The property was originally developed in 2005 and represents high quality affordable housing in a high growth market. Thirty-two of the 216 units are reserved for seniors, and the financing reduced the maximum allowable rent on 10 percent of units to 50 percent AMI. It also extended the rent restrictions at 60 percent AMI for the remainder of the property. The project was supported with a $29.4 million bond allocation from the county’s Economic Development Authority.
The transaction, which closed the last week of July, was originated by Capital One senior vice president of Agency Finance Evan Williams. The 16-year fixed-rate loan has two years of interest-only payments and will be amortized over a 40-year schedule. It also included an earn-out, which allowed the deferral of rent increases for Grand Oaks residents.
“As part of the financing, the property will be preserved with a renovation budget of over $12 million,” said Williams. “Capital One was proud to react quickly with the final bond allocation coming only 3 business days prior to the bond expiration, ensuring the property could access tax exempt bond financing.”
Fairfield is undertaking a comprehensive renovation of the property, including installing new bathroom and kitchen appliances, flooring, cabinets and lighting in units. Community improvements include new roofing, landscaping upgrades, and siding and breezeway repairs.
“This preservation effort provided us the opportunity to make significant upgrades through renovated units and community spaces while extending affordability to the residents and families who call Grand Oaks home for an additional 25+ years,” said Paul Kudirka, senior vice president and head of affordable housing for Fairfield. “Capital One’s expertise and flexibility enabled us to complete this transaction in a timely manner and preserve hundreds of affordable rental units in Virginia.”
Capital One’s Commercial Real Estate Group offers a comprehensive array of financing solutions for property owners and developers nationwide, including balance sheet and agency lending. As a top-10 agency lender*, Capital One provides financing for multifamily investors nationwide through Fannie Mae, Freddie Mac and FHA programs. Additional information can be found at capital.one/multifamily.
*Fannie Mae reported 2021 Multifamily DUS(R) Lender Awards and Freddie Mac reported 2021 Top Optigo(R) Lenders by Volume.