Fifteen Group Gets $162M Refinance Of Boyle Heights' Wyvernwood Apartments
The Miami-based Fifteen Group secured $162.9M in two loans from lender MF1 Capital to refinance Wyvernwood Garden Apartments, one of the city's largest apartment communities.
The Real Deal reported the refi, citing data and a report from ratings agency DBRS Morningstar.
Morningstar didn't disclose loan terms in its report, but TRD reported MF1 securitized one of the loans into a collateralized loan obligation. The average interest rate for the whole CLO, which totals nearly $900M, was 8.87%, TRD reported. Fifteen Group's rate caps mean it is paying between 3.5% and 6%, but those will eventually expire.
Fifteen Group bought the 1,175-unit complex in Boyle Heights in 1999. In 2007, it announced plans to bring condos to the site, but city leaders opposed it, and in 2019, the city terminated its planning case for that project, TRD reported.
Morningstar's report says the property isn't in great shape, with cracked sidewalks and tenant belongings spilling out into common areas. No capital improvements are planned "in the near future," Morningstar wrote. The owner has also had difficulty with rent collection since the pandemic began and recently filed 30 eviction notices, according to Morningstar.
Lender MF1 Capital is a partnership between Berkshire Residential Investments and Limekiln Real Estate that supplies senior mortgages, mezzanine debt and preferred equity for multifamily properties. It also provided financing for Fifteen Group's acquisition of Laguna Properties' troubled Downtown LA portfolio.
