HUD Four-Property Portfolio
Case Study
Property Info
Property Objectives
Berkadia FHA/HUD structured four HUD 223(f) refinancings totaling more than $123MM, delivering long-term fixed-rate financing, boosting proceeds, and supporting affordability through tax-exempt structures and housing authority partnerships.
This four-asset portfolio represented refinance opportunities of assets that were acquired in the last five years. Each asset needed maximum leverage to payoff existing debt, reposition with minor repairs and establish long term fixed rate financing so property owners can enhance property operations.
Berkadia Solution
Berkadia evaluated numerous solutions, including GSE, bridge and ultimately provided the sponsors the HUD 223(f) that allowed long term fixed rate financing with the greatest leverage. Berkadia worked in parallel to a developing partnership with The Henry at Rosenberg under House Bill 21 and existing partnerships with Houston Housing Authority. The HUD execution was able to accept the full property tax exemption to achieve the objective of maximizing proceeds.
Client Results
The borrower was able to benefit by paying off existing short-term bridge loans that were placed during the initial acquisitions. The affordability preserved through tax-exempt structuring and the operational flexibility created through lower refinancing pressure, allowed our client to reinvest in residential experience. The sponsor implemented a strategic capital improvement plan that focused on common areas for each of the four properties. Achieving leverage up to 87% provided proceeds to minimize further cash infusions and preserve capital.
The combination of HUD fixed rate 35-year amortization along with HUD’s willingness to underwrite the full ad valorem tax exemption provided a win/win for the residents, property, housing authority partners and the sponsors by maintaining increased affordability while allowing the property owners to focus on operations.
The Berkadia Advantage
This portfolio required more than a standard refinance. Berkadia’s experience with HUD and expertise in FHA-insured financing allowed us to be a true advisor to the sponsor. By aligning HUD execution with tax-exempt structures and housing authority partnerships, we helped the sponsor secure long-term financing, amplify proceeds, and preserve affordability across four communities.
Mortgage Banking
Client Stories
Sunburst
Apartments
Berkadia is dedicated to leading the digital transformation of commercial real estate with investments in technology like Esusu, a rent-reporting platform created to build tenants’ credit. Multifamily property owners who implement Esusu can decrease evictions and vacancies and maximize NOI. As partners, Berkadia borrowers may receive closing cost credits and discounted rates.
551 W PRENTICE AVE
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We recently partnered with Freddie Mac and Spira Equity Partners to help rehabilitate and preserve 392 units of affordable housing for the residents of Brittany Bay Apartments. Brittany Bay has the most units of any community in a High Opportunity Area that Freddie Mac has financed.
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