In 2017 we originated an $15,785,600 FHA-insured Section 223(a)(7) loan that refinanced the outstanding HUD-insured loan that financed construction of Waterview at Sugar Mill Pond a 168-unit market-rate apartment project located in a planned community. The Project was developed and is managed by Vintage Realty Company, a privately owned, full-service real estate firm specializing in the brokerage, leasing, property asset management, development, and construction.
Interest rates had declined since the original refinancing, providing Vintage with the opportunity to generate debt service savings. We advised them of this positive development in the market and suggested a refinancing structured under HUD’s Mortgage Note Modification/Interest Rate Reduction (IRR) protocol.
Acting as Financial Advisor, we developed the initial financial modeling of the transaction and coordinated the development of the formal IRR proposal with the existing loan servicer, whom we brought into the 2017 refinancing. The entire transaction took approximately 75 days to complete.
The IRR reduced the interest rate by 37% and will generate total debt service savings of approximately $5.8 million through the remaining term of the loan.
The IRR, completed three years after our initial financing, is another example of SMF maintaining long-term relationships with our clients and delivering to them ongoing value. Sims has closed 26 HUD-insured loans for Vintage since 2002.