Red Oak Capital Holdings, LLC has provided a $15.5 million bridge loan for Minnesota Commons Apartments in Washington, D.C. The funds will be used to acquire and rehabilitate the garden apartment community, which will operate under the DC Housing Authority’s Housing Choice Voucher Program (DCHCVP).
Ken Wood, Red Oak’s Regional Manager-Northeast, originated the debt, which was underwritten and administered by Hermann Wendorff, Senior CRE Underwriter, and Jesus Martinez, Senior CRE Loan Administrator. Steve Bowen, CEO of Your Banc Advisors, LLC, brought the loan to Red Oak on behalf of the borrowers, who are seasoned local contractors and investors with extensive experience in the DC multifamily market, specifically with properties enrolled in the DCHCVP program.
“The redevelopment of Minnesota Commons aligns perfectly with our commitment to supporting projects that address critical housing needs,” said Wood. “Given the sponsor’s significant track record in redeveloping aging properties into affordable apartments, we’re confident in their ability to once again deliver a high-quality product that meets the demands of the local market.”
Situated on 1.5 acres at 4069-4089 Minnesota Avenue NE, Minnesota Commons Apartments consists of two three-story buildings that were built in 1942. The sponsor’s $3.6-million capital improvement budget calls for extensive renovations that will expand the unit count from 83 to 123, including a reconfiguration to add more two- and three-bedroom units. Plans involve cosmetic and functional upgrades including new flooring, lighting, electrical and plumbing systems, HVAC installations, and kitchen and bathroom remodels. Upon stabilization and full lease-up, the borrower intends to refinance the Red Oak loan with permanent financing.
“With housing supply constraints and high demand in Washington, D.C., this project will help meet the needs of residents while contributing to the revitalization of the local area,” stated Gary Bechtel, CEO of Red Oak. “Our loan will enable the sponsor to execute their vision and transform this asset into a thriving community for families.”
Located in the District’s Benning neighborhood, Minnesota Commons is within walking distance of the Minnesota Avenue Metro station and nearby essential services, including grocery stores and local parks. While the area is experiencing a surge in development, there continues to be a large demand for modern, affordable housing options as the city continues to expand.
