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GMACCM/AHD arranges $34 million acquisition financing. (Commercial).

GMAC COMMERCIAL MORTGAGE CORPORAtion's (GMACCM's) Affordable Housing Division (AHD)/Newman Financial Services Inc. (NFSI) has arranged a $34 million acquisition and rehabilitation financing of the Valley Palm Apartments, a 354-unit project in San Jose, California. Valley Palms will set aside ioo percent of its rental units for families earning no more than 6o percent of the area median income. The financing was a collaborative effort of the various financial platforms of GMAC Commercial Holding Corporation (GMACCH), Horsham, Pennsylvania, including Newman & Associates Inc. (investment banking services), Paramount Financial Group (low-income housing tax-credit equity), NFSI (construction financing guarantee and standby subordinate debt) and AHD (Fannie Mae credit enhancement).

The financing involved long-term Fannie Mae credit enhancement of $33.7 million of weekly variable-rate, tax-exempt bonds. Rehabilitation and stabilization risk was undertaken by the Bank of America, which in turn was backed up by a first-loss guarantee from NFSI. Additionally, NFSI committed to acquire up to $4 million of the bond issuance in a subordinated position to the remaining Fannie Mae enhanced bonds in the event the project failed to meet its anticipated stabilized net operating income. The transaction was the first closing for the newly formed Affordable Housing Division of GMACCM. "Four divisions of our holding company combined to provide a comprehensive financial solution and common underwriting platform in this financing. We are quite excited about our future prospects to bring innovative partnering of our divisions to meet the challenges of affordable housing" said Steven Fayne, managing director of AHD.
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Publication:Mortgage Banking
Article Type:Brief Article
Geographic Code:1USA
Date:Jun 1, 2002
Words:248
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