Rosano Partners: Lenders Loosen The Reins On Urban Multifamily Product

LOS ANGELES, Calif. – July 15, 2015 – (RealEstateRama) — In a market that is flooded with capital for large acquisitions, Rosano Partners, a firm that specializes in urban commercial real estate, is proving that multifamily lending has also re-emerged in niche, urban markets.

“The brutal truth is that it has typically been very difficult to secure competitive financing for small apartment projects in diverse, urban neighborhoods,” says Sagiv Rosano, Founder and President of Rosano Partners. “Today, however, lenders are becoming much more aggressive, especially in multifamily product. With a default rate of only .05% or lower, the appetite for multifamily is insatiable, and we are seeing an emergence of finance providers ready to lend in these small, niche neighborhoods.”

Rosano Partners, a full-service commercial brokerage, recently arranged financing for three apartment projects in diverse Los Angeles neighborhoods, including:

17th Street in Santa Monica – 77.7% LTV Financing Closes in A Week

Rosano Partners recently arranged acquisition financing for a six-unit apartment community in Santa Monica, which was purchased by a private family investor as a 1031 exchange.

The borrower needed a loan of just $1.3 million, however the funding was needed extremely quickly. Rosano sought out a bridge lender and worked with Lone Oak Fund to secure a first-trust deed.

“Time was of the essence, and we knew that Lone Oak could move fast without contingencies or inspections,” explains Rosano. “Even with that loan in place, we needed to reach a higher loan-to-value, which was a challenge based on the rapid timeframe.”

Rosano Partners worked with United Security to quickly secure a second-trust-deed loan, bringing the total loan-to-value to 77.7%, and dropping the blended interest rate of the financing from 10% down to 7%, according to Rosano.

The property is located at 1833 17th St. Santa Monica, CA.

513 Union in Los Angeles – Low Interest Rate For Borrower With Bankruptcy

Rosano also secured acquisition financing for a 12-unit apartment building located at 513 Union Street, just west of downtown Los Angeles.

“This was a good borrower who had a bankruptcy only as a result of litigation,” explained Rosano. “Historically, it would have been nearly impossible to secure a low-interest loan for a borrower with an issue this serious on his credit. However, based on today’s lender appetite for multifamily, as well as our ability to package the deal in a way that was attractive to financiers, we were able to secure a $1.05 million loan for the borrower at a very low rate of 4.5%.”

5611 Fulcher Ave in N. Hollywood – Selling a Lender on a Syndicated Deal

Rosano Partners also recently secured funding for the $1.9 million refinance of a 19-unit apartment building in North Hollywood, California.

“This was a syndicated transaction, and the syndicator owned less than 20% of the property,” explained Rosano, who noted that other owners of the property held approximately 5-10% ownership each.

“Typically, syndication is a major obstacle for lenders,” Rosano says. “Because this syndicated borrower held such a small stake in the property, lenders were initially concerned that the borrower could walk away from the loan without much to lose. Our team worked together to demonstrate the strength of the borrower, as well as the balance of the deal structure, and we were ultimately successful in securing the loan for our client.”

Rosano Partners is a completely different kind of full-service commercial real estate brokerage. The firm uses integrated technology and an extremely diverse team to produce real estate solutions that make a difference in urban markets through Southern California.

For nearly 10 years, Rosano Partners has provided sales and leasing, property management and finance services throughout Southern California. Headquartered in Los Angeles with an office in San Diego, the company specializes in retail and multifamily product, unique urban development opportunities, as well as placements of equity or debt.

For more information, visit www.rosanopartners.com.