HFF arranges USD800.45m in financing for 23-property multi-state apartment portfolio

Holliday Fenoglio Fowler has arranged financing totalling USD800.45 million for a 23-property multifamily portfolio consisting of 7,289 units across eight states.

The HFF team worked exclusively on behalf of Starlight Investments, a Toronto, Canada-based real estate investment and asset manager, and its closed-end fund, Starlight US Multi-Family (No5) Core Fund. The loan was originated as a Freddie Mac Structured Pool Transaction with five, six and seven-year loan terms and included both fixed- and floating-rate components.
Additionally, the loan allowed ultimate flexibility with collateral release provisions and varying prepayment windows. This transaction also took advantage of Freddie Mac’s index lock program, allowing the sponsor to lock the underlying rate several months prior to closing. Freddie Mac’s Structured Pool Transactions target large, single-sponsor portfolios and provide enhanced structuring to meet the borrower’s specific needs. The master note, which is secured by the cross-collateralised pool of 23 properties owned by Starlight US Multi-Family (No5) Core Fund, will be serviced by HFF, a Freddie Mac Multifamily Approved Seller/Servicer.
The 23 Class A properties are located in the Atlanta, Austin, Charlotte, Dallas, Denver, Houston, Las Vegas, Nashville, Orlando, Phoenix, Raleigh, San Antonio and Tampa markets. The average year of construction for the portfolio is 2012, and the properties boast an average occupancy of 93 per cent overall. Nearly half of the units (47.5 per cent) were financed under Freddie Mac’s Green Advantage program, which help finance energy- and water-saving improvements that help lower operating costs for buildings, keep utility costs low and protect the environment.
The HFF debt placement team representing the borrower included senior managing director Matt Kafka, managing director Campbell Roche and analysts Matthew Williamson, Tolu Akindele and Wilson Bauer.
“The Starlight US Multi-Family (No5) Core Fund portfolio comprises 23 institutional-quality assets located in strong growth markets across the US,” says Kafka. “Given the high-performing nature of the assets and diversity of the income stream, Freddie Mac’s Structured Solutions Group was able to customise an incredibly flexible and attractive debt execution.”
“This transaction was tailored to meet the unique needs of this borrower and the complex nature of this portfolio, which is exactly the purpose of the Structured Pool Transaction offering,” says Lauren Garren, vice president of Production & Sales at Freddie Mac Multifamily. “The Structured Solutions Group worked closely with Freddie Mac’s regional teams on this multifaceted and complex transaction, and it would not have been possible without close collaboration with our strong partners at HFF and Starlight. We look forward to continuing to work with these partners to devise solutions to meet the needs of borrowers.”