BWE, a national commercial and multifamily mortgage banking company, announced today that it has secured over $100 million in financing through a Freddie Mac transitional line of credit for a collection of over 2,500 manufactured housing community sites located in the Midwest, Southeast, and Rocky Mountain regions.
MJ Vukovich, executive vice president in BWE’s Denver office, Ghazy Grijalva, vice president in BWE’s Chicago office, and Andrew Capra, assistant vice president in the Denver office, arranged the $150 million transitional line of credit (TLOC) through Freddie Mac’s Optigo channel on behalf of a long-term client. The team also simultaneously sourced a $14,000,000 traditional bank loan for the borrower from a lender specializing in manufactured housing.
“Freddie Mac’s transitional line of credit is an exceptionally powerful financing tool for portfolios that are on the fringe of eligibility for permanent financing, giving borrowers the resources to complete repairs, increase occupancy and bring properties to market rate before taking on permanent debt. We’re proud to secure this line of credit for our clients so they can continue to effectively manage and grow their portfolio,” said Vukovich. “As the sector continues to grow, BWE’s manufactured housing team is committed to helping borrowers get the capital they need to build and finance their properties across the country.”
The transitional line of credit provides a convenient solution for manufactured housing communities that require more repairs and renovations before securing permanent financing terms or more flexibility in their hold period. By only initially using $100 million of the $150 million TLOC, the borrower has the ability to shape their portfolio more thoroughly by adding new properties in the future. BWE’s manufactured housing team structured the TLOC as a full-term, interest-only loan with a floating rate. Additionally, the terms included interest rate caps to hedge against the risk of increasing rates, while also positioning the client to take advantage of a declining rate environment later this year and provide flexibility for asset exit.