Venture capital firm 137 Holdings secured a $32.515m in permanent financing to take out a short-term construction loan for the development of South Pointe Apartments. The 252-unit property was built in 2017, approximately 30 miles south of downtown Miami. Berkadia sourced the funding through Fannie Mae which originated a 12-year loan with five years of interest. The loan takes out a $26.7m construction loan provided by Ocean Bank when the project broke ground in 2015.
“Long-term holders in the market have recognized that, for the first time in many cycles, the cost between shorter-term fixed rate debt and long-term debt is extremely narrow,” said Charles Foschini, senior managing director at Berkadia. “We are increasingly asked to price 12-year money and longer for clients who recognize that the extended interest-only period and overall cost of capital produces a tangible benefit for the operation of the property and potentially the next buyer.”
