Location: Philadelphia, PA
Loan Amount: $6,000,000
iFC Loan Product: New Construction
Property Type: Multifamily
Loan Closing Date: 12/30/2022
Purchase Price: $500,000
Construction Budget: $5,700,000
Loan to Cost: 80%
Length of Loan: 18 months
Project: Ground-up development of a 10-unit multifamily building and new construction of 8 duplexes.
This is the first deal that Argo Property Group, a company specializing in residential and multifamily development in Philadelphia, is doing with i Fund Cities.
The customer was looking for a lender to move quickly and to give more leverage than their banking relationships.
The customer bought land and added a ton of value by going through zoning/entitlements. The bank was not comfortable lending on the imputed equity that was built into the project, thus, the total loan amount the bank was willing to offer was much lower than the amount the developer was seeking.
We were able to look at the value added to the land and give the customer value for the equity they built. Not only were we able to give 10% more leverage than the bank, but we also gave them credit for the imputed equity, which made for a much better loan.
The borrower did not have to bring any cash to closing – in fact, they walked away with a check! In addition, we were able to originate a loan for all 26 units so we did not have to phase construction. The customer received a loan for 100% of their construction budget.
“You guys are champs for honoring the original term sheet.”