Stormfield Capital’s Post

What an extraordinary month July was for CapitalRise with our highest number of New Deals completed totalling £50m! By far and away our record month. This also coincides with our financial year end where we will be able to report a significant Growth in Lending Origination from the prior year and setting another record milestone for our business. Impressive results given this is set against a backdrop of what's undoubtedly been a very challenging year in the development finance market, where transaction volumes have been low, deal execution times have been painfully slow and with continued volatility around build costs, residual land values, interest rates and the challenges with the planning process. Here's where we deployed the Capital, which demonstrates the range of support we are providing to our developer borrowers and debt advisory partners in the market. ▫ £8.3m Ground Up Development Loan for 2 new build luxury homes in Wimbledon ▫ £5.7m Development Exit Bridge Loan with Equity Release on new build homes in Colchester ▫ £1.7m Pre-Development Land Bridge Loan to support planning for High Value single dwelling in Ascot ▫ £7m Finish & Exit Bridge Loan for 3 apartments in Chelsea ▫ £6.3m Lease Enfranchisement Bridge Loan in Mayfair ▫ £10.3m Ground Up Development Loan of 5 Apartments in Chelsea ▫ £8.3m Development Loan for 28 unit Serviced Apartment scheme in Bloomsbury ▫ £1.6m Pre-Development land bridge Loan to support planning for 2 luxury dwellings in Emerson Park ▫ £400k Mezzanine Loan for an airspace development in West London A great team effort from across the CapitalRise business from Origination, Credit Risk, Capital Markets, Investor Relations and Finance. With todays base rate reduction, sitting alongside a low inflationary environment, I think we are very well placed to support increased demand and activity across London and the Southeast for the remainder of 2024 and into 2025. Raf Chowdhury | Katy Katani | Imogen Williams | Edward Groves | Aadam Samiullah | Max Brady #realestatefinance #propertydevelopment #developmentfinance

Terrific. What size loans bridge and permanent ?

Fident Capital secured $29.0MM of bridge financing on a recently constructed mixed-use property with 52 apartments and ground floor retail. Loan proceeds funded the conversion of a multifamily asset, located only three blocks from the Ocean at the iconic Oceanside pier, into for-sale condos. The lender, a private debt fund based out of New York, provided non-recourse financing that allowed a cash-neutral refinance of the existing debt. Project Highlights: •Optionality from the original condo specifications and tentative map allowed for an easy pivot from, and back to, a for-sale strategy. •Experienced lender partner with deep expertise in all aspects residential housing, including conversions, offered pragmatic solutions reserve and incentive structures.  •Well-built mixed-use project in idyllic location three blocks from the beach. Non-recourse, cash neutral financing which capitalized all necessary reserves and conversion costs.      Challenges: •Complicated mixed-use wrap product surrounded a public-private parking garage with bifurcated access for residents. •Navigating perceived pressure on potential condo buyers from a rising interest rate environment. •Considerable cash flow analysis was required to plan for HOA, tax, operating, interest, and incentive plan reserves as revenue declined upon vacating rental units in order to sell them.  #commercialrealestate #mixeduseproperty #entrepreneurship #realestatefinance #sandiego

Another IMG project! Interesting asset stabilization strategy. Build to condo spec... initially for rent- then conversion to condos.

Cracks in the Commercial Property Market Are Widening to Apartments : cracks in the commercial real estate market are widening from offices to apartment complexes, with more than $67 billion of the housing potentially distressed as borrowers struggle to repay loans “Collateral performance in CRE CLOs deteriorated throughout 2023 with stress and delinquency rates rising sharply the final two months of the year” “Owners who made purchases at record-high prices may have found their assets landing on servicer watchlists as assumptions used to underwrite their acquisitions proved overoptimistic” Arbor had about $7.3 billion of collateralized loan obligations outstanding last year16.5%of Arbor loans were past due in December, per Santander : Apartment loans emerging as problem area in CRE space

FSCA facilitates a $11,550,000 bridge loan for Ciprés’ inaugural project, The Rider, a to-be-built 146-unit luxury condominium project being developed at the crossroads of Miami’s Midtown and Wynwood neighborhoods. With an “Old Hollywood” rock-and-roll theme, the project reflects Ciprés’ commitment to innovative and distinctive real estate ventures. Sales are currently underway, and the project is expected to break ground later this year. Once pre-sales hit a certain benchmark, FSCA will refinance this acquisition bridge loan with a construction loan. This closing marks the first with Rilea Group and Cipres, which led to the subsequent closing of Vista Verde at Port St. Lucie - another acquisition land bridge loan for Rilea Group and Cipres' as they expand their footprint northward. Despite today's headwinds, these closings were made possible due to our Franklin Street Capital Advisors platform and collective team effort, especially Nick Sumpter. The Real Deal: https://lnkd.in/eQ9EirAT South Florida Business Journal: https://lnkd.in/eTHvcBFv

In 2015, Shorenstein Properties' acquired the #groundlease on1407 Broadway, a 1.1 million s.f. 43-story office building in Manhattan, for $330 million. Thereafter, it invested $62 million in upgrades and, in 2019, borrowed $350 million against the property. The property is now unable to make debt service payments and is in default. Moreover, the loan set to mature in November. This, my friends, is #ValueVaporization! If you're facing a debt maturity and/or a default, then #letstalkrealestate! #bankruptcy #workout #restructuring #receivership #receiver #independentdirector #default #defaults #cmbs #leveragedfinance #leveragedloans #cre #realestate #realestateconsultants #realestatebroker #realestatebrokerage #realestatebrokers #realestateexpert #realestatedevelopment #realestateexperts #realestateexpertise #realestateexperience Keen-Summit Capital Partners LLC Turnaround Management Association American Bankruptcy Institute NAFER | NATIONAL ASSOCIATION OF FEDERAL EQUITY RECEIVERS https://lnkd.in/es35MnAc

We're working with a developer who's completing a garden-style apartment in DFW. They financed the senior construction loan through a regional bank at modest leverage and layered in preferred equity to get to 72% LTC. This pref piece compounds monthly and has a minimum multiple that the investor must hit upon pay-off (refi/sale). The developer wants to pay off their preferred equity investor given the rising cost of compounding interest - not to mention softening rents, occupancies, and construction delays. We've identified multiple lenders targeting projects approaching Certificate of Occupancy or, ideally, in lease-up with some cash flow in-place. Terms are 24 or 36 months with one or two 6-12-month extension(s). These lenders are sizing to either a Y2 or Y3 stabilized NOI, burning off concessions from Y1 to Y2 and can underwrite up to 3% rent growth in years 2 and 3. They're looking to solve for a stabilized economic occupancy of 88-95% and a 7.75-8.50% debt yield. For projects still under construction, hold-backs or earn-outs may be available to achieve TCO. Pricing is S+285-425 - some groups are wider, but mid 300s seems to be competitive for market. An at-the-money cap is generally required, capitalized in the deal with SOFR floors ranging from 400-500bp (while term SOFR sits at 5.32% today). Prepay is generally 12-18mo minimum interest. 1% origination fee and 25-50bp exit fee - some can be higher but waived if refinanced with Fannie or Freddie. For developers who have expensive preferred equity or are facing pains with their construction lender (banks who want $ off their books, loan maturities, etc.), "construction-to-bridge" money is widely available. Although it may result in a cash-in or cash-neutral scenario, this strategy can achieve a lower blended cost-of-capital and provide additional term for developers, particularly those who do not wish to sell in the current environment and/or believe treasury rates will be materially lower in 2025 and beyond. Please reach out if we can be a resource in any way. #apartmentdevelopment #multifamilyinvesting #constructionfinancing #bridgeloans #capitalmarkets Greysteel

In addition to the hurdles that multifamily property owners are facing with re-financing on traditional loans that are maturing, CRE CLO bring additional risk to owners holding this kind of debt. Leverage our data to find acquisition opportunities at below market pricing. Feel free to reach out to me to discuss how you can access these opportunities jcummings@costar.com "46% of CRE CLO loans still aren’t generating the net operating income that was baked into the loan underwriting"

Big Refi. #WednesdayCRE #CommercialRealEstate #CommercialDebt #CommercialInsurance Florida East Coast Realty has secured a $419.6 million financing package to refinance an 85-story mixed-use residential, hotel and office building in Miami’s Brickell neighborhood. The debt package involves a five-year, $334.6 million Freddie Mac-backed senior loan with a 35-year amortization by Greystone Servicing Company. The deal also includes $85 million of agency-backed subordinated debt and an investment in tandem with CPP Investments and Harbor Group International, according to Greystone. #SourcingAndSelling #SellingAndSourcing #Retwit #2024 ~ Contact Us for Commercial Investments, Financing and Insurance. Multifamily, Industrial, Hotels, Office, Retail, Development Sites, Plus. #ListWithLance #LanceLoans #LetLanceInsureYou #CRE #Owners #InvestmentProperties #Multifamily #Industrial #Hospitality #Retail #Development #Construction #Commercial #CommercialTransactions #CommercialFinance #CommercialInsurances #CommercialTitleAndClosing #CommercialProp https://lnkd.in/gcGff2Rb