PGIM Lends $16M on Montana Affordable Senior Housing Property
By Andrew Coen June 16, 2023 11:56 am
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Lincoln Avenue Capital (LAC) has secured $16.14 million of agency-backed financing for the acquisition and rehabilitation of a Montana affordable senior apartment asset, Commercial Observer can first report.
PGIM Real Estate provided the fixed-rate Federal Housing Administration 223(f) loan on LAC’s South Forty Apartments in Billings, Mont. The transaction was led by Alex Viorst, executive director at PGIM Real Estate.
“We’re thrilled to have partnered with LAC — a mission-driven organization and one of the fastest-growing developers, investors and operators of affordable housing in the country — on this transaction,” Viorst said in a statement. “We worked closely with HUD to help the borrower secure a post-rehab Mark-Up-to-Market rent increase that was effective as of the closing date and generated sufficient loan proceeds to fund the rehab necessary to meet the long-term needs of the property.”
Located at 769 Fallow Lane, the 101-unit, age-restricted apartment complex is 100 percent subsidized by a Section 8 contract. The property also has a Land Use Restrictive Agreement tax credit that restricts half of the units for people earning 50 percent of the area median income and the other half at 60 percent AMI through 2069.
LAC plans an extensive rehabilitation of the1987-built property aimed at addressing deferred maintenance in addition to revitalizing the apartments and on-site amenities. The complex, which was renovated in 2007, will also have new solar panels installed as part of the rehab project.
“Our acquisition of South Forty Apartments will preserve more than 100 units of high-quality, affordable housing for seniors in Yellowstone County,” Jeremy Bronfman, CEO of LAC, said in a statement. “LAC is grateful to PGIM Real Estate for its support in making this deal a reality, and we look forward to working together in the future to provide affordable homes in communities where they’re most needed.”
Andrew Coen can be reached at acoen@commercialobserver.com
