Gershman Investment Corp. Secures $78.3M for St. Louis Apartment Renovation

Gershman Investment Corp. Secures $78.3 Million FHA Loan for Mansion House Apartments

Gershman Investment Corp. recently announced the successful financing of a substantial renovation for the iconic Mansion House Apartments, located in St. Louis, Missouri. This undertaking involves a remarkable $78.3 million FHA 221(d)(4) Sub Rehab Loan, which will provide vital construction and permanent financing for one of the city’s most notable high-rises.

The Mansion House Apartments, with its elegant 29-story stature, is situated adjacent to the Gateway Arch, making it a prime location within St. Louis. With 415 apartment units, the building has been a significant part of the local landscape since the 1960s. The planned renovations aim to modernize the property while preserving its historical significance, with fully updated units expected to be available by 2027.

Managing Director Chris Will played a pivotal role in securing this loan, which underscores Gershman Investment Corp.'s strong commitment to enhancing residential living spaces in downtown environments. The $195 million investment for this project is one of the largest seen in the area for decades, creating a new chapter in the life of the Mansion House Apartments.

In addition to Gershman’s FHA-insured debt, the financing package includes several other funding sources. These include State and Federal Historic Tax Credits, Opportunity Zone capital from Catalyst Opportunity Funds, and gap financing from the Arch to Park Equity Fund. The City of St. Louis also facilitated the process through real estate tax abatement and a sales tax exemption on construction materials, showcasing a collaborative effort to revitalize the community.

The FHA 221(d)(4) loan, which is backed by GNMA, offers a 40-year fixed interest rate and operates as a non-recourse financing option, thus reducing the financial risks associated with such a large-scale project. Furthermore, the loan’s terms are considerably favorable, thanks to its backing by The Builder's ProLoan Bond Fund, which consists of various labor trade unions as its members. This arrangement has resulted in obtaining a significantly below-market interest rate, further enhancing the feasibility of the project.

The FHA 221(d)(4) Substantial Rehabilitation loan program is specifically designed to support the purchase and significant renovation of multifamily rental properties. It combines both construction costs and permanent debt within a single loan, which streamlines the financing process for such extensive undertakings.

Gershman Investment Corp. stands out as one of the few independently owned mortgage companies in the U.S. that specializes in FHA-insured multifamily and healthcare financing. With over 70 years of experience, the firm is reputed for its personal service and problem-solving capabilities which ensure a seamless loan process for financing projects. They are ranked among the top ten originators of FHA multifamily programs according to the U.S. Department of Housing and Urban Development.

For potential investors and residents, this project signals a promising development in the heart of St. Louis. The revitalization of Mansion House Apartments not only contributes to the city’s housing supply but also enhances the area’s historical landscape with modern living arrangements. As the renovation progresses over the next couple of years, Mansion House is poised to attract a blend of new residents, further enriching the community fabric.

For further information on Gershman Investment Corp. and their financing opportunities, you can visit their official website at gershmaninvestmentcorp.com.