SAN FRANCISCO, Sept. 14, 2011 /PRNewswire/ -- Piping Rock Partners announced today that it has successfully refinanced $4.35 million in acquisition debt for a 120-unit multi-family asset in Southern Indiana, using new financing insured by the U.S. Federal Housing Administration ("FHA"). The property was purchased in 2010 using a privately placed, fixed-rate interim-term loan.
"From day-one, our strategy had been to finance the acquisition on a long-term basis with low-cost debt insured by the FHA, and this refinancing brings the entire process to a successful close," said Chris Germain, President of San Francisco-based Piping Rock Partners Inc.
The interest rate on the new FHA-insured loan was 3.75%, more than 100 basis points below the weighted average cost of the existing debt, and the new loan to value at closing was approximately 80%. The reduced interest rate significantly enhances the investment's cash flow, while the fully amortizing, 35-year term eliminates all refinancing risk.
"We are renovating the entire property from top to bottom, including all new roofing, siding, signage and landscaping to new appliances, cabinetry and trim," said Germain. "Now, we are able to marry the rent growth from those improvements with much lower debt service expense and significantly reduced risk. It's a huge success."
About Piping Rock Partners:
Piping Rock Partners Inc. is a private San Francisco-based investment management firm with a focus on multi-family real estate. The firm provides real estate management and advisory services to family offices, Registered Investment Advisors and fee-only financial planners. The firm's principals have completed almost $4 billion in commercial real estate debt and equity financings, including $3 billion in multi-family mortgage financing.
Christopher K. Germain
Piping Rock Partners Inc.
San Francisco, CA
For informational purposes only. Investment offerings are made only by prospectus.
SOURCE Piping Rock Partners Inc.