Multi-Family Value Add
Multi-Family Value Add/Hotel Conversions
Term (up to)
24 months
Purpose
Acquisition or refinance of a multifamily property with the intent to renovate and stabilize
Property Type
Existing 5+ unit multifamily or hotel conversion to multifamily
Maximum Loan Amount
- Min Loan Amount $500,000
- Max Loan Amount Per Unit $3,000,000
- Max Loan Amount $20,000,000
Total Units Per Loan
Multiple properties per loan are allowable if in the same jurisdiction
As Repaired / Improved LTV
70%
Day 1 LTV
65%
LTC
85%
Monthly Payments
Interest Reserve is required for the full term. Monthly Payments with an additional 0.50% Origination Fee and proof of >10% liquidity
Funds At Closing
For acquisition and reimbursement of Construction Costs.
Sizing Requirements
- Minimum DSCR 1.25x using: o 0.250% over the provided take-out letter by a Builders Capital approved provider, fully amortizing over 30-Year Term o 30% minimum OPEX
- PACE Financing allowed with max CLTC 80% and no tail after the payback of PACE financing. If condo, PACE requires 30% per unit paid with each sale.
General Requirements
- All lending for investment purposes only
- Interest calculated on drawn balance unless Gross Interest
is selected - Construction draws based on inspection report or
supporting documentation - 1st Lien Position always
- Evidence of vertical permits ready for pick-up or in file prior
to closing. No exceptions.
Borrower Requirements
- No Individuals. Borrower must be an LLC or Corporation.
- Minimum 700 credit score. Exceptions considered with compensating factors.
- Must have demonstrated experience of similar property types and size in the last 18 months. Demonstrated
experience is evidenced of completed and sold or stabilized inventory. GC experience may not be counted unless the
GC becomes a guarantor of the project. - Liquidity 5%. May not included earnest money deposited
towards the sale of the finished project. - Personal Guarantee preferred; Limited Guarantee considered with 50bps fee paid at closing (may not be
rolled into the loan balance). - Maximum Guarantor Loan Commitment with us is $50,000,000. Exceptions considered for large regionals or repeat borrowers.
