Eastern Union Facilitates $15.9 Million Financing for New Multifamily Housing in East Peoria

Eastern Union Secures $15.9 Million for Multifamily Conversion

Eastern Union, a prominent player in commercial real estate financing, has successfully arranged a significant $15,918,000 acquisition and construction loan for the transformation of a former assisted living facility in East Peoria, Illinois. This ambitious project will convert the property into a modern multifamily housing complex, boasting a total of 246 units designed to cater to the growing demand for residential rental spaces in the area.

Project Details

The site, located at 500 Centennial Drive, encompasses approximately 212,374 square feet on a spacious 23.4-acre lot. Currently vacant, it was originally constructed in 1984 as an assisted living facility. The redevelopment initiative aims to revitalize the property into a desirable living environment that meets contemporary standards and amenities, which are desperately needed in the expanding East Peoria market.

Joe Siegfried, a senior loan originator at Eastern Union, played a crucial role in structuring this financing deal. The borrower, The HA Group based in South Bend, Indiana, specializes in real estate investment and development, focusing on adaptive reuse and value-add opportunities across various asset classes. The financing was facilitated by Genesis Capital, a firm located in Sherman Oaks, California.

The loan structure represents approximately 85% of the loan-to-cost ratio, highlighting an advantageous financing arrangement for the project. It features a three-year interest-only term, with no prepayment penalties, and an interest rate based on SOFR plus a margin of 500 basis points. This arrangement offers significant flexibility for the sponsor, allowing for effective management of the renovation process.

Renovation Plans

The comprehensive renovation plan for the existing structure includes enhancements that will elevate the property to meet market expectations for quality housing. Proposed upgrades to the facility encompass the installation of modern kitchen appliances, improved cabinetry, enhanced closet designs, upgraded countertops, and efficiency improvements to the HVAC system. Furthermore, the inclusion of a swimming pool will serve to enrich residents' lifestyle options, catering to families and individuals alike.

This project is strategically positioned in the Centennial Drive corridor, an area identified for its residential rental growth potential. The conversion from an assisted living facility to a multifamily property is not just crucial for increasing housing inventory but also serves as an essential response to the upward trend in rental demands in this burgeoning market.

Mr. Siegfried commented on the transaction, stating, "The key to this transaction was securing high-leverage financing in a secondary market while still achieving favorable loan terms. We succeeded in structuring 85 percent of the total project costs along with an aggressive interest rate, providing the sponsor with the necessary financial support to carry out their conversion strategy effectively."

With the local demand for quality rental properties on the rise, this redevelopment project signifies a vital step towards enhancing the housing landscape in East Peoria. Eastern Union's expertise in securing favorable financing arrangements underscores their commitment to fostering real estate investments that have a tangible impact on community development.

About Eastern Union

Founded in 2001, Eastern Union has positioned itself as a formidable force in the national commercial real estate sector, working with a diverse range of financing options and securing billions in transactions annually. With a dedicated team of over 90 experienced professionals, Eastern Union leverages its extensive lender relationships and market knowledge to provide the most competitive rates and terms for clients. Their portfolio encompasses various real estate categories, enabling them to serve a wide array of investment needs across the United States, including multifamily, healthcare, and retail properties. For more information about Eastern Union's offerings and expertise, please visit www.easternunion.com.