Genesis Capital Lends $66M for San Diego Affordable Housing Development

A Southern California developer has landed an eight-figure construction loan for a transit-oriented affordable housing project in San Diego. 

Encinitas-based Ambient Communities secured $66.2 million for Palm & Hollister Apartments, a 198-unit, garden-style complex at 555 Hollister Street in San Diego. Northmarq’s Aaron Beck, Bryce Quezada, Conor Freeman and Wyatt Campbell arranged the financing with lender Genesis Capital on behalf of Ambient.

Ambient’s development is in San Diego’s Palm City neighborhood, adjacent to the Palm Avenue MTS Trolley Station and just one block east of Interstate 5. The project will only include eight affordable units at 30 to 60 percent of the local area median income, according to plans filed with the City of San Diego.

The loan, which closed within 60 days due to Northmarq’s long-standing relationship with Genesis, per the broker, will have an initial three-year term with an option to roll the debt into a mini perm loan upon completion of the project. 

“This was a very competitive process, with multiple quotes received. Genesis Capital ultimately won the business by providing up to 75 percent  loan-to-cost and structuring a few key terms for the borrower, including the deferral of equity at an attractive interest rate,” Beck said in a statement. “The loan was also negotiated on the borrower’s behalf to allow them to take advantage of the declining short-term interest rate environment. 

As traditional banks continue to shrink away due to market uncertainty and red tape, Genesis Capital is becoming a standout alternative lending platform for borrowers seeking greater flexibility and financing options. Genesis CEO Clint Arrowsmith sat down with Commercial Observer in October to discuss his firm’s growth, relationship-driven lending and market trends. Nick Trombola can be reached at ntrombola@commercialobserver.com.