Huntington National, Nuveen Green Capital Lend $41M on Florida Build-to-Rent Project

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Stark Enterprises has sealed $40.5 million of construction financing for its planned build-to-rent residential project in northern Florida, Commercial Observer has learned.

Huntington National Bank provided a $22 million senior loan and Nuveen Green Capital originated an $18.5 million Commercial Property Assessed Clean Energy (C-PACE) loan on Stark’s Summerfield Pointe Village development in Summerfield, Fla. 

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The project, slated for completion in 2026, will feature 264 rental homes in 64 buildings on 110 acres adjacent to The Villages 55 and older community.

Christopher Ellis, senior director, originations, at Nuveen Green Capital, said the deal was in the works going back to last fall and the opportunity was attractive due in large part to the development’s proximity to The Villages, the largest retirement community in the nation with around 125,000 residents.

“The majority of those residents own their own property and this was an ability to bring the for-rent product to that market,” said Ellis of the opportunity for Summerfield Point to benefit from being close to The Villages. “While it’s not age restricted, it’s marketed towards that 55-plus community that are looking for an opportunity to be in The Villages area and have access to all the amenities, but for whatever reason do not want to own a home.” 

The C-PACE loan will fund energy efficient measures including roofing, windows, exterior walls,lighting, electrical and plumbing. The non-recourse loan covers a 30-year period. 

Ellis noted that the deal priced out at around 70 percent loan- to-cost and Huntington was looking for an additional lender to reduce leverage. He said a number of senior lenders are exploring C-PACE to add to the capital stack in a higher interest rate environment.

“Two to three years ago we were an alternative to mezzanine financing or preferred equity or reducing equity and during COVID, we were able to pivot and provide some rescue capital or bridge financing,” Ellis said. “Those still hold true today but I think given where the pricing is on PACE debt and where the  pricing is on senior loans we are right there with them so from a borrower’s perspective and from a bank’s perspective we’re taking that participation risk off the table.”

Ellis added that another advantage for Huntington National in this deal was that Nuveen Green Capital was able to take proceeds from the loan and escrow with the bank, which helps them increase their reserves.

Ezra Stark, CEO of Stark Enterprises, said in a statement that after completing another BTR community in Oscala, Fla, “our confidence in the immense demand for rental homes and the communities we craft has only grown stronger.”

Huntington National declined to comment. 

Andrew Coen can be reached at acoen@commercialobserver.com