$25,000,000 Construction Loan & $2,350,000 Mezz Loan
221-Unit MF Development
Downtown Long Beach, CA
HRC secured a $25.5 million construction loan coupled with $2.35 million in mezzanine debt comprising 95% of total project costs for the development of a 221-unit luxury multi-family property in downtown Long Beach. The mezzanine debt was competitively priced at LIBOR + 7% with no profit participation. This high leverage financing structure allowed the developer to maintain 100% ownership of the project. Midway through construction, the developer wished to reduce his recourse exposure by bringing in a joint venture partner. The principals of HRC arranged $5.5 million in joint venture financing reducing the recourse financing from 95% of cost to 77%, and returning some cash equity to the borrower.