University Grande Apartments, Hammond, LA
ABOUT
University Grande Apartments, Hammond, LA
Linden Lane Structured Capital (LLSC) originated a $6.1 million preferred equity investment for a ground-up student housing development in Hammond, LA. The loan was originated in July of 2019 and is expected to be paid off before year-end 2021. Pricing is low double digits; last dollar funded equaled 83% of cost. The project was essentially built in 12 months, is fully occupied and never experienced a COVID pandemic related problem. Significant value was created quickly, reducing our last dollar of LTV exposure to approximately 55%. The loan has always been paid fully current every month; the yield is exceptional for the risk and will most likely repaid in full when the asset is sold. LLSC’s deep broker relationships, superior construction expertise and ability to understand strong middle market sponsors provided a competitive edge.
Situation – Experienced sponsor seeking accretive preferred equity for a ground-up, student housing deal in a tertiary market.
Strategy – LLSC recognized the sponsor as being extremely strong financially and professionally. Though small university town, Freddie Mac and Fannie Mae would lend and size a take-out loan in excess of our exposure.
Results
Sponsor selling the asset in the Spring of 2021. LLSC total term just under 3 years. Property stabilized in 12 months at a value equivalent to LLSC the last dollar of risk of 55%. Deal level IRR 14%+.
GALLERY
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