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$8M Non-recourse Commercial Loan for the Purchase of Two MHPs

Monday, Jan 12, 2015
by Jeff Meierhofer

The Madison Group Facilitates a $8M Non-recourse Commercial Loan for the Purchase of Two MHPs in Arizona.

The Madison Group (TMG), a commercial broker and loan consultant, has facilitated the financing of a $10.8 million Manufactured Home Community portfolio purchase that includes Paradise Valley Ranch, a 168 unit, age 55+ adult manufactured home community in Paradise Valley, AZ and Chaparral Ranch, a 100 unit age park in Apache Junction AZ.

TMG able to get a high leverage, non-recourse loan with a 10 year fixed term and 30 year amortization on each park.  RV pads and seasonality with the tenants required that TMG find the right lender to address these specific issues upfront. In addition they both needed to close in a timely manner during the holiday season to meet the buyer and seller agreements.

TMG facilitated the application and was able to close one loan in 40 days, with the other before the end of the year as required by the purchase contract.  There were a lot of moving parts with these transactions including seasonal tenants, RV pads, and a private sewer system, along with a closing deadline before year end.  TMG analyzed the information provided and was able to find the right lender to fit with the specific needs of the buyer.

 “Both properties were being purchased as a portfolio deal.  Seasonality with these types of communities, along with the RV component required us to negotiate higher leverage on one park to meet the buyers total financing needs.  Due to our experience with this property type, we were able to mitigate the issues up front and find the right lender to facilitate the most favorable terms to meet the clients goals”, said Angela Kesselman of The Madison Group, who originated the financing.  “The borrower was able to secure a 10 year term while getting maximum proceeds while closing on a tight deadline, during the holidays.”

The financing was arranged by Angela Kesselman Associate Director of Finance at The Madison Group.

Upon closing their transaction, the client commented:  “It has been a pleasure to work with the Madison Group team on our most recent two acquisitions of Manufactured Home Communities in Arizona.  From the moment I spoke with Jeff to the day to day interaction with Angela and Brandi, I was impressed with the professionalism, preparedness and ability to stay up with or ahead of our team!  Your involvement allowed my team to be more effective as you focused on quickly and efficiently addressing those items the leader needed without always involving us unless necessary.  We look forward to working with you again!”

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