$55M Freddie Mac Financing Closes for Suburban Maryland Apartment Property
- Sep 16, 2008
Financing to the tune of $55 million has been put in place for the Keswick Park Apartments, a 406-unit multi-family asset in Crofton, Md., about 25 miles northeast of Washington, D.C., and 25 miles south of Baltimore. Acting on behalf of Boston-based borrower Berkshire Property Advisors L.L.C., real estate investment banking and commercial mortgage brokerage firm Johnson Capital orchestrated the financing. The backing came in the form of a seven-year fixed-to-float loan with a 6.11 percent interest rate–through Freddie Mac’s Acquisition-Rehab program. The interest-only financing will be amortized over 30 years following the first four years of the term. “We represent a variety of lenders and Freddie Mac ended up being the most competitive from an equity return perspective for the purchaser.” Martin Fayer, senior vice president with Johnson Capital, told CPN. Carrying the address of 1623 Parkridge Circle and located adjacent to the Crofton Country Club, Keswick Park encompasses 10 three- and four-story structures developed in 1991. Berkshire, which snapped up the apartment community from a joint venture consisting of Greenbelt, Md.’s The Bozzuto Group and New York City-based JP Morgan, is not disclosing the exact cost of the acquisition, but the company will utilize the remaining proceeds of the loan to renovate Keswick Park. “The purchaser was interested in the property because it presented an opportunity to upgrade units and generate good returns, while simultaneously providing reasonably-priced housing in a relatively high-demand market,” Fayer added. While occupancy levels have increased a bit, the demand for apartments in Washington, D.C., and Baltimore remains strong. The average stabilized vacancy rate for Class A properties is 3.6 percent in Metropolitan Washington, D.C., and 4.9 percent in Baltimore’s southern submarkets, according to a midyear report by commercial real estate research and advisory firm Delta Associates.