The $37.3m funding originated from Knighthead Funding LLC will fund three multifamily projects in Michigan. Knighthead worked with each lending borrower to build individual strategies to execute their business plans successfully. Loans ranged from 18 to 36 months and are secured by assets in individual markets.
“These three transactions show how Knighthead’s flexible source of capital was able to structure its debt according to the unique needs of each borrower; whether the project was mid-construction, ground up or extensive interior rehabilitation.”Jonathan Daniel, Knighthead Funding Principal
Knighthead provided a Michigan developer $17.7m – the largest of the finances – as a first mortgage loan to finance a four-storey building in Traverse City, one of the regions high end vacation spots. Demand has increased in the area due to the population growth – around 6.4% in the last eight years, making Traverse City is the largest city in the Northern Michigan region. This demand has created the need for more multifamily homes.
The 78 multifamily homes will include a mix of studio, one, two- and three-bedroom apartments, and will have 162 parking spaces and 9,726 sq. ft of ground level retail in Traverse City. The multifamily apartments will be finished to a high standard, with stainless steel appliances, washing machines and dryers and polished concrete floors.
Greatwater Opportunity Capital who have a portfolio of 510 multifamily units were funded $10.8m to acquire and renovate two multifamily buildings. The buildings – in Midtown’s Cass Corridor in Midtown Detroit will have 118 homes and 4,600 sq. ft of retail spaces. Since 2015, Detroit has seen 26% growth in tech jobs and a growing millennial population of 9.2%. In the past five years, the growth of annual rent remained above 2.5%.
An $8.8m loan was also provided to construct 19 multifamily homes in Downtown Ann Arbor – with 50% pre-sold. The property – branded ‘The Gallery’ – is in the Old West Side neighbourhood – in walking distance to the University of Michigan.
“Based on the Sponsor’s development experience, strong presale numbers, unit layouts and downtown location, we are confident in the success of the business plan.”Peter Illuzzi, Knighthead Senior Associate
Founded in 1971 by Alex de Perry, Ann Arbor Builders are experienced in multifamily, single-family and mixed-use construction, development and renovations .