Bethpage Federal Credit Union’s $28M Loan Refis Md. Student Housing Property
Columbia, Md.-based Star Global Ventures (SGV) has gotten $27.5 million in debt from Bethpage Federal Credit Union to refinance its student housing property, The Enclave, in College Park, Md., Commercial Observer has learned.
The 10-year, non-recourse debt pays interest at a fixed rate of 4.5 percent, sources said. The loan-to-value was 60 percent — established over a 1.25x debt service coverage ratio — indicating that the asset’s value sits at around $49 million.
New York-based HKS Real Estate Advisors’s John Harrington sourced the financing on behalf of the borrower, SGV, which holds The Enclave under the entity, Star View Plaza, LLC.
According to commentary provided by Harrington, this loan didn’t go the route of an agency or commercial mortgage-backed securities execution because those options weren’t as competitive and were more prohibitive in underwriting and structure, with unattractive yield maintenance and defeasance prepayment penalties.
“Considering the performance of the property — and the growing interest in the area — the borrower wanted a more intimate bank [or] portfolio lender deal, specifically with no prepayment penalty or lockout, and Bethpage came to the table with exactly what we asked for, and we closed within 45 days,” Harrington said in a prepared statement. According to information from HKS, SGV requested a structure devoid of a prepayment penalty or lock-out period in a move to keep its options open, “due to the overwhelming interest in the property, and possible plans for expansion or further development.”
Built in 2011, the seven-story, 94-unit development spans 175,000 square feet and is located at 8700 Baltimore Avenue in College Park, less than a mile north of the main campus of the University of Maryland. The property sports a private courtyard, a study lounge, a computer lab, a community room, a 24-hour fitness and recreation center and a tanning room. It also includes about 9,000 square feet of retail, food and beverage offerings on the ground floor as well as three levels of covered parking, spanning just over 117,000 square feet at the property’s rear.
The student housing residences comprise 132,452 square feet spread across six floors of the building, according to sources. The courtyard and lobby, together, make up 12,425 square feet.
The property’s units — totaling 369 beds — are all fully furnished, and many of the rooms each have a private bathroom. In addition to a handful of two- and three-bedroom units, there are 35 four-bedroom, two-bathroom units, averaging 1,000 square feet, and 53 four-bedroom, four-bathroom apartments, averaging 1,200 square feet.
Monthly rents range from $855 for the four-bedroom, two-bathrooms to $985 for the three-bedroom, two-bathroom apartments, according to the property’s website.
A representative for Bethpage Federal Credit Union was not able to provide a comment or more information before publication.