Berkadia Provides $44 Million in Financing for Multifamily Property in Chicago Suburb

(BRK.A), (BRK.B)

Berkadia has announced the financing of York Brook Apartments, a multifamily property located at 100 E. George Street in Bensenville, Illinois.

Managing Directors Len Deering and Paul Matusiak of the Chicago office negotiated the 35-year, fixed-rate refinancing loan for the borrower, YB Partners.

The $44.08 million loan was originated through Berkadia’s HUD/Federal Housing Administration program. The loan features an 80 percent loan-to-value ratio and a 35 year amortization schedule.

“Our team was quite familiar with this repeat client and carefully worked to obtain attractive terms that met their needs,” said Deering. “An uptick market-wide occupancy coupled with rising asking rent prices makes Chicago an attractive market, one that is expected to see more upside for the duration of 2016.”

The 571-unit property sits on nearly 28 acres of land and was 98 percent occupied at the time the loan was secured. Located approximately eight miles southwest of Chicago O’Hare International Airport, York Brook Apartments offers one- and two-bedroom floorplans and unit amenities such as open kitchen plans, individually controlled heat and air conditioning, private patios and balconies, dishwashers, garbage disposals and furnished rental options. The community, set in a park-like area that includes a lake, offers tennis courts, pools, storage lockers, fitness centers, a laundry facility, free aerobics classes and 24-hour maintenance.

About Berkadia

Founded in 2009 as a 50/50 joint venture between Berkshire Hathaway and Leucadia National Corporation, Berkadia is a third-party commercial mortgage servicer, as well as an approved lender for Fannie Mae, Freddie Mac, and HUD/FHA. The company was among the top Freddie Mac and Fannie Mae multifamily lenders for 2013.

Berkadia owes its origins to GMAC Commercial Mortgage Corporation, which was acquired in 2009 by Kohlberg Kravis Roberts & Co., Five Mile Capital Partners LLC, and Goldman Sachs Capital Partners. Christened Capmark Financial, the company had $10 billion of originations in 2008 and a servicing portfolio of more than $360 billion before running into bankruptcy in October 2009.

In a deal approved by the bankruptcy court, Capmark sold its mortgage loan and servicing to the newly formed Berkadia in a deal worth $515 million.

The deal brought Berkshire into the heart of the commercial loan serving business, and the company has one of the largest commercial real estate servicing portfolios.

© 2016 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.