Market Insights

Multifamily borrowers are continuing to benefit from a strong rental market. Many are taking advantage of the increased rents and NOI’s by refinancing and pulling cash out to be used for a variety of purposes, such as returning equity back to investors, performing capital improvements, or applying the funds toward additional investment opportunities.

  • Banks and credit unions will typically lend up to 70 – 75% LTV on stabilized assets.
  • They are typically looking for 24 – 36 months of seasoning shown through a leveling of revenues and expenses on the operating statements, prior to allowing a full cash out of all the borrower’s equity on value-add deals.
  • If the borrower has owned the property for less than 18 – 24 months, the lenders will typically offer loan proceeds based upon the borrower’s total cost, and not on the current perceived value of the property.
  • Fannie Mae and Freddie Mac remain the most competitive non-recourse multifamily lenders for investors looking for longer term, fixed rate, loans at higher leverage.
  • Life Co's most competitive at lower leverage with some offering full term IO, forward rate lock, or more unique structures.
  • The agencies will lend up to 75 – 80% LTV after 18 months of ownership, and can provide supplemental financing after 1 year of placing the initial loan.
  • While short term borrowers have seen coupon rates rise due to increasing 30-day LIBOR, decreasing lender spreads have helped buffer the increase.
  • Treasury rates remain steady and long term borrowers can still obtain 10 year money in the high 3 to low 4% range depending on loan size, asset quality, and location.

more news & insights

Globe St.| Feb 13 2024
Tower BTR Team GlobeSt 2024 Rainmakers
Yield PRO| Jun 04 2024
Tower Capital Arranges $47 Million in Construction Financing for 217-Home BTR Community Village at Mayfair in Texas
ConnectCRE| Jun 04 2024
Empire Obtains $47.4M Loan for New Braunfels BTR Community
The Herald Zeitung| Jun 04 2024
Arizona developer to build 217 rental homes at New Braunfels' Mayfair
1 2 3 33

Scottsdale

15333 N. Pima Road
Suite 375
Scottsdale, AZ 85260
480-426-0560
AZ CMB-0928926

Dallas

2626 Cole Ave
Suite 300
Dallas, TX 75204
214-661-7633

Los Angeles

1801 Century Park East
24th & 25th Floors
Los Angeles, CA 90067
323-923-6032
CA DRE-02237859
Copyright © 2024 All Rights Reserved Tower Capital | Website Developed by Connect Creative
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram