Continental Funding Group (CFG) arranged a $41,000,000 construction loan for the development of Valencia, a 218-unit, class-A multifamily housing project in downtown Los Angeles. The transaction featured a 70% loan-to-cost, LIBOR-based, interest only, construction loan. The loan was structured with enough proceeds to pay off an existing land loan, provided funds for all future hard and soft costs as well as an interest reserve.
The loan was funded by a bank that specializes in multifamily construction debt. The Lender provided the three-year, floating rate loan to the Borrower, an experienced developer, while Mitch Paskover of Continental Funding Group acted as the intermediary. Mr. Paskover commented that, “working with a sophisticated Borrower and Lender was truly a pleasure. The Borrower requested we find a Lender that would originate the entire loan on their balance sheet so they did not have any syndication risk. We were also able to convince the Lender to use the current market value of the land to lower the overall equity required to close the loan by the Borrower. Both parties brought highly competent teams to the transaction and worked with a cooperative spirit throughout the process.”
Valencia is located in the emerging Central City West residential community of downtown Los Angeles. The 1.5-acre site sits on nearly an entire city block and fronts Wilshire Blvd. and Valencia St. Valencia is adjacent to the 408-bed Good Samaritan Hospital which is undergoing an $80 Million expansion and currently employs 2,375 staff and 650 physicians.
Valencia is entitled for 218 apartment units and 4,500sf of commercial. Units will have approximately 9′ ceilings with washer/dryers and private balconies. Amenities include over 20,000 sf of dedicated open/recreation space covered with lush resort-style landscaping, BBQ areas, pool, spa, fitness center, 5,000sf outdoor garden, and a club lounge. In addition, 244 bicycle spaces have been incorporated into the design for the increasing environmentally-conscious walking population. Valencia’s location has a Walk Score of 85, making it a “Very Walkable” community, and has been rendered a “Rider’s Paradise” with a Transit Score of 93 due to its high transit connections.