Walker & Dunlop, Inc. closed two Fannie Mae loans totaling $160,711,000 with Cortland Partners for the acquisition and moderate rehabilitation of two East Coast apartment developments.
Both transactions were financed using Fannie Mae’s Structured Adjustable-Rate Mortgage (SARM), a variable interest rate loan that provides long-term financing with attractive floating rates and prepayment flexibility.
Year to date through September 30, 2016, one third of Walker & Dunlop’s total lending through Fannie Mae and Freddie Mac has been floating rate, as experienced borrowers with a wide array of investment objectives choose to take advantage of the attractive rates and flexible terms offered by this loan type.
Stephen Farnsworth, managing director, led the New Orleans-based team. He commented, “Cortland Partners is an experienced sponsor that has a unique investment horizon for each property in its portfolio. Our team worked with Cortland to determine that Fannie Mae’s SARM was the most strategic execution for these properties, and we tailored the loan terms of each transaction to best align with the sponsor’s strategy.”
Jeffrey Ketron, director, Multifamily Customer Engagement for Fannie Mae, said, “Our SARM execution was the perfect fit because of how fast-moving these acquisitions needed to be. ”
Stoneridge Apartments and Century Northlake Apartments are garden-style apartment communities located in Ashburn, Virginia and Charlotte, North Carolina, respectively.
Cortland Partners plans to take advantage of these two rapidly-growing markets by repositioning the properties through capital improvements, unit renovations, and rebranding to capture substantial rent premiums. T
he SARM backed by Stoneridge is a 7-year, full term interest-only loan, and the SARM backed by Century Northlake is a 10-year loan with a 5-year interest-only period.