Calmwater Capital has provided an Arizona-based private investment group with $10.5 million in short-term first mortgage debt to refinance a 65-unit multifamily property, The Heights on Lemon Apartments, in Tempe, Arizona.
Built in 1966 and renovated in 2021, the garden-style community is made up largely of two-bedroom apartment homes housed in eight two-story residential buildings. Each unit features stainless steel appliances, wood-style flooring, washer and dryer, and spacious kitchens. Common area amenities include a pool, sundeck, courtyard and BBQ/picnic area. The property is currently 97% leased.
The sponsor, an experienced multifamily investor and operator in the Phoenix area, acquired the property in 2021 with in place rents well below market. Since the purchase, the sponsor has invested more than $1 million on interior renovations, HVAC replacement, and multiple exterior upgrades.
“Since acquiring the asset, ownership has pushed rental growth and substantially improved the property,” said Calmwater Director Zachary Novatt, who led the origination team that included Managing Principal Larry Grantham and Vice President DaJuan Bennett. “The Calmwater bridge loan will provide the sponsor an opportunity to continue improving the asset while preserving flexibility, which has become very important in the current market environment.”
Heights on Lemon benefits from its location in the heart of Downtown Tempe, which serves as a central hub for shopping, dining, nightlife, and recreation for residents in the area, including the approximately 75,000 students and faculty that attend nearby Arizona State University. The large student population combined growing tech sector continue to be tremendous demand drivers for quality rental housing in Tempe.
