Kay Finance Secures Acquisition Financing for North Carolina Luxury Properties

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Van Metre has nabbed nearly $50 million of U.S. Department of Housing and Urban Development (HUD)-backed financing for its acquisition of a North Carolina multifamily portfolio, Commercial Observer has learned.

Kay Finance closed the $49.9 million acquisition bridge loan on behalf of Stone Gate and Village on the Lake I & II, two luxury apartment developments comprising 564 units in Spring Lake, N.C., just outside of Fayetteville. The interest loan features a six-month initial term with extension options. It is 85 percent loan-to-cost with a 4 percent interest rate.

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Walker & Dunlop was the HUD lender on the transaction. The deal was secured by Walker & Dunlop Senior Vice President Jeremy Nussbaum, along with Kay Finance CEO Yair Tilson and Vice President of Origination Alex Yudin

“What made this deal unique was the acquisition was initially planned to be financed using a conventional HUD loan,” Tilson said. “But, due to timing, we adjusted strategies and ultimately had the lender, Walker & Dunlop, lend us a bridge loan off their own balance sheet with very attractive terms, which allowed the client to close on time.”

Located at 201 Stonebriar Circle and 605 Village Lake Court, the luxury rental properties are located about five miles from the largest U.S. Army base, Fort Bragg.

Great Neck, N.Y.-based Kay Finance is a boutique capital advisory firm specializing in debt and equity placements. It has closed more than $1 billion in transactions, including $42 million of construction financing for a Texas multifamily property last month.

Fairfax, Va.-based Van Metre and Bethesda, M.D.-based Walker & Dunlop did not immediately respond to requests for comment on the deal.