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How Big is Small Cap Multifamily?

A closer look at the multifamily housing inventory in the United States and the size of the small cap investment opportunity.

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Multifamily Forecast: Investors Moving to Secondary Markets

The apartment sector has remained the darling of the commercial real estate for the past six years. This doesn’t appear to be changing anytime soon, as 2016 is expected to set a new record for multifamily mortgage origination volume. While multifamily’s position as top dog remains uncontested, savvy investors are altering their strategy for sourcing Read the full article…

GENERAL: 800.ARBOR.10

FANNIE MAE DUS®

Seniors Housing

Arbor’s Seniors Housing provides financing options for properties that provide Independent Living (IL), Assisted Living (AL), Alzheimer’s/Dementia Care (ALZ), or any combination.

Loan Amount Minimum $5M, with exceptions on a case-by-case basis
Loan Term 5 to 30 years
Amortization Up to 30 years
Minimum DSCR
  • 1.30x if the property is 100% Independent Living/li>
  • 1.40x for properties with an assisted living and/or Alzheimer’s component greater than 50%
  • 1.45x if the property is stand-alone Alzheimer’s/Dementia Care
  • 1.50x if the property contains skilled nursing units

For combinations of IL, AL, and ALZ, special rules apply to calculate minimum DSCR.

Maximum LTV 75% (80% for fixed-rate, tax-exempt bonds)
Rate Structure Fixed- and adjustable-rate options available
Eligible Properties
  • Independent Living properties
  • Assisted Living properties
  • Alzheimer’s/Dementia Care
  • Newly constructed and stabilized Seniors Housing facilities, as well as campuses containing skilled nursing beds on a case-by-case basis
Eligible Borrower Single Asset Entity. Owners and operators must have a minimum of five years experience in Seniors Housing, owning and/or managing a minimum of five stabilized properties
Property Requirement All properties must have a fully operational separate category sprinkler system in all units and in common areas and may not charge entrance fees. Typical community fees are allowed
Occupancy Requirement At least 90% occupied for each of the past five fiscal years
Tax & Insurance Escrows Fully funded replacement reserve, tax and insurance escrows are required
Replacement Reserves Underwritten at a minimum $300 per unit per annum.
Recourse Nonrecourse execution is available, with standard carve-outs required for “bad acts” such as fraud, bankruptcy and illegal transfers
Commercial Space Maximum 10% of net rentable area and 10% of effective gross income.
Required Reports Appraisal, Property Condition Assessment, Phase I Environmental, Zoning, Termite, Flood and Seismic Report (for properties in Seismic Zones 3 and 4)

Licensed seniors housing properties also require a Seniors Housing Liability Assessment Report

Prepayment Yield maintenance, defeasance, and graduated prepayment premium
Assumable Loans may be assumable, subject to review and approval by the Lender and Fannie Mae of the proposed new borrower’s financial capacity and experience. 1% assumption fee
Subordinate Financing Not allowed
Supplemental Financing Supplemental Loans are available
Pricing Risk based pricing; more favorable pricing available for higher DSC and lower LTV
Rate Lock 30- to 180-day commitments; the early rate lock option is available with prior approval from Fannie Mae, allowing the borrower to lock a rate after the lender completes preliminary underwriting; extended rate lock feature is also available, allowing the borrower to lock a rate 45 to 365 days in advance of closing
Application Deposit $20,500; covers estimated processing and legal fees
Origination Fee 1% of loan amount
Good Faith Deposit 2% of loan amount, due at rate lock, refundable post-closing

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