The Madison Group, a commercial broker and loan consultant, has facilitated the financing for $825,000 multifamily refinance. The property consists of 5 four-plex (20 units units) in Ephraim Utah. The borrower had a first and second mortgage with a higher rate and wanted to lock in a lower rate and longer term.
The apartment complex is located in a small MSA community with 13 of the 20 units occupied by students. The property was purchased in 2004 in poor condition and low occupancy. The property had a storied history with added partners and a seller carry back. Substantial renovations were undertaken over the years bringing the asset to B-quality. The current owner took over sole ownership one year ago and his basis was less than 20%.
The Madison Group facilitated the financing with a fixed rate of 5.2%; Term: 10yr; Amortization: 25yr; LTV: 61%. The borrower was able to control operating expenses and increase the income which mitigated the storied history. The borrower was able to pay off the second mortgage and now will benefit from a longer loan term, and much lower rate.
The financing was arranged by Jeff Meierhofer, Director of Finance at The Madison Group.