Case Study: $47MM Multifamily Property | Recapitalization | Fairfield, CT

Restructured and upsized a multi-tier capital stack to retire existing investor base.     

Challenges

Sponsor desired to hold the newly built apartment building while it continued its master-planned, transit-oriented development of this new city near the Fairfield Metro train station. An LP investor with a restricted hold period required pay-off. Though well-leased, cash flows had not reached full stabilization because some retail tenants were not yet in occupancy and free rent periods were still burning off.

Solutions

EyzenCo canvassed a variety of senior debt options, then surveyed the structured capital markets to achieve the lowest weighted average cost of capital. Potential options included a combination of ground lease and leasehold debt and fee simple mortgages in tandem with mezzanine debt or preferred equity. Ultimately, a west coast fund operator offered a winning combination of a long-term preferred equity commitment with an attractive combination of price, proceeds and operating and reporting terms. To minimize frictional transaction costs the existing lender matched market terms while upsizing its outstanding balance.