Interest-Only Is Back!
Guelda Voien Aug. 18, 2014, 9 a.m.
Meridian Capital Group arranged $47.5 million in financing for a nine-property multifamily portfolio located in Manhattan, Yonkers and Mount Vernon—and all nine loans had lengthy interest-only periods.
Manhattan-based residential owner, broker and manager Coutinho Properties received funds from three different lenders for acquisitions and refinancings in and around New York City. Meridian Vice President Isaac Filler handled the negotiations.
“As this portfolio illustrates, Meridian has taken a lead role in re-opening the market for full-term interest-only financing outside of CMBS and agency executions,” Mr. Filler said. “The availability of interest-only periods still varies widely based on a variety of factors, especially with balance sheet lenders, but non-amortizing loans remain a valuable tool for our clients,” he added.
Coutinho scored $20.6 million in funds from First Republic Bank, to purchase two properties and refinance two others, all in Manhattan.
All of these loans feature interest-only payments for their full four- and five-year terms and feature interest rates between 2.88 percent and 3.30 percent. The properties are located at 303-307 East 95th Street, 108 West 111th Street, 245-247 West 113th Street and 32 West 86th Street.
The three other multifamily properties—at 257 Valentine Lane in Yonkers, 266 South Fulton Street in Mount Vernon and 160 East 4th Street in Manhattan—received a $7.8 million mortgage, a $6.8 million mortgage and a $3.3 million mortgage, respectively, all provided by People’s United Bank. These loans feature interest rates of 2.75 percent and interest-only payments for their full four-year terms.
And two final Manhattan assets took loans from Santander Bank. Debt on 302-322 East 104th Street and 69 West 107th Street ticked in at $4.8 million and $4.2 million, respectively, and had five-year terms. The mortgage on the 104th Street property has a rate of 3.47 percent and two years of interest-only; the West 107th Street loan has a rate of 3 percent and an interest-only period for the full term.