Multifamily Value-Add Loan | Riverside, CA

Courtyard

In an increasing rent rate environment, investors can find great opportunities in purchasing multifamily properties and then completing value-add rehab projects that allow them to maximize their monthly cash flow. That’s what Lima One helped an investor do when financing a multifamily bridge loan that covered the purchase and value-add rehab for this 16-unit garden apartment complex in Riverside, California.

The investor planned to purchase the property for $3.34 million and then spend $814,000 on rehab including new cabinets, countertops, flooring, and stainless steel appliances in each unit. The property also needed a new roof with skylights, new security fencing, new hardscape and artificial landscaping, and new HVAC and water heaters. The investor was also going to add bedrooms to three units and split one unit into two.

Lima One financed 75% of the purchase price and 50% of the rehab on a $2.9 million non-recourse loan that provided 70% blended loan to cost leverage, allowing the investor to increase the property value to $4.48 million. This allowed the investor to capture immediate equity while increasing rent rates to improve the property’s cap rate over the long term.

18301 Von Karman Avenue, Suite 700
Irvine, CA 92612