Build-to-rent financing often requires a capital stack that combines construction debt with equity capital tailored to the project’s business plan, timing, and lease-up expectations. In this Tampa case study, Skylatus structured $17.5 million of capital for the ground-up development of a 126-unit build-to-rent community, including $12 million of construction debt and $5.5 million of private…
Details
Smart Hotel Management Agreements: Owner Control Essentials (Part 1) Hotel owners face three primary management options: self-management, third-party hotel management companies, or franchisor-managed operations. Each requires a formal hotel management agreement—even self-management often needs one with an affiliate to satisfy lenders. Franchisor deals typically lock owners into 20-year terms with limited exits, making smart structuring…
Details
Understanding HUD 223(f) Loans: Key Features for Multifamily Property Financing HUD 223(f) loans are a powerful financing option for stabilized multifamily properties, offering high leverage, non-recourse terms, and long amortization periods. This blog builds on previous insights to highlight the main attributes every investor should know. Non-Recourse Financing With High Leverage One of the standout…
Details
HUD 223(f) Loans: Game-Changing Refinance for Stabilized Multifamily HUD 223(f) loans finance acquisition or refinance of stabilized multifamily properties with 5+ units, offering developers faster access to cash-out refinances without the former 3-year age requirement—lifted in 2020. This enables refinancing as soon as the property hits HUD’s debt service coverage ratio (DSCR) for one month,…
Details
BSPRA: Boosting Leverage in HUD 221(d)(4) Loans BSPRA—Builder’s Sponsor Profit and Risk Allowance—serves as a theoretical 10% profit on hard and soft construction costs for HUD 221(d)(4) loans, acting as a mortgageable “paper profit” that no developer receives in cash. This mechanism replaces banned traditional developer fees on market-rate deals, inflating total project cost to…
Details
HUD 221(d)(4) Loans: Essential Features for Multifamily Construction HUD 221(d)(4) loans finance new construction or substantial rehabilitation of multifamily properties (5+ units), requiring improvement costs exceeding $15,000 per unit—adjustable in high-cost markets. Loan Terms and Structure Loans feature 40-43 year terms: base 40 years plus up to 3 years interest-only construction period, followed by fully…
Details
HUD Loans for Multifamily & Healthcare: Core Structural Features HUD loans finance diverse multifamily and healthcare properties through specialized products like 221(d)(4) for construction, 223(f) for stabilized acquisitions/refinances, and 232/223(f) for healthcare facilities—each tailored to the asset’s business plan. Consistent Loan Structures Across Products HUD maintains uniform structural advantages: Non-recourse protection for borrowers. Assumable with FHA approval…
Details
HUD Loans for Multifamily Real Estate: Complete Overview Guide HUD (U.S. Department of Housing and Urban Development) loans provide powerful, government-backed financing for multifamily real estate projects, offering non-recourse terms, high leverage, and long amortization periods ideal for developers and investors. This blog summarizes the key insights from Skylatus Property Capital’s video “OVERVIEW OF HUD…
Details
CMBS Loans Part 4: Understanding B-Piece Buyers in Commercial Real Estate B-piece buyers purchase the riskiest B-rated and unrated bonds in CMBS loan pools, taking first-loss position for higher yields and significant control rights. They shape securitizations for multifamily, hospitality, and commercial properties, directly impacting loan availability and pricing. B-Piece Buyers’ Role in Loan Pools…
Details
The Role of Rating Agencies in CMBS Loans In the world of CMBS (Commercial Mortgage-Backed Securities) loans, rating agencies play a crucial role in assessing credit risk and enabling the trading and securitization process. Randy Efron from Skylatus Property Capital explains their importance in this episode of the CMBS loan series for commercial multifamily and…
Details
CMBS Loans Part 2: Interest Rates and Key Structural Elements CMBS loans for commercial multifamily and hospitality real estate feature interest rates priced as spreads over swap rates (e.g., 10-year swaps for 10-year loans), typically fixed for the full term with options for interest-only, amortizing, or hybrid structures. Amortization is usually 30 years, though hotels…
Details
CMBS Loans Part 1: Fundamentals for Multifamily and Hospitality Real Estate CMBS (Commercial Mortgage-Backed Securities) loans finance stabilized commercial properties intended for 5+ year holds, where originators pool loans into securitizations—chopping them into bonds with varying risk/return profiles sold to fixed-income investors. Post-closing, a master servicer handles borrower interactions, replacing the originator. Key Advantages of…
Details