Referred by an existing client, Sweetwater Capital set out to place permanent financing for this 160 unit multifamily property in late 2019. Looking to achieve $12.2MM loan amount, we had a few hurdles to jump through to close the deal.
First, we needed to raise the occupancy and revenue. We introduced the borrower to a new property management group who provided consulting services, allowing the property to raise occupancy from 87% to 94% in 4 short months and collect outstanding rents.
Nearing the end of due diligence, there was an ownership change which prompted a slight delay and then BAM, the world stopped when Covid-19 struck. New requirements announced by Fannie Mae required our borrowers to now bring $1MM to closing to cover the newly required escrows. Not at all acceptable to the borrowers, they resigned themselves that the deal was dead.
The tenacity and creativity of the Sweetwater team revived the deal and with outstanding results. Exceeding expectations, our borrower received a lower interest rate 3.59% which pushed the loan amount up to $13.2MM, allowing our borrowers to walk away from the closing table with cash-out.