Tower Capital Closes $60.5 Million Loan for Liv Goodyear

Tower Capital, Phoenix-based commercial real estate finance firm, has closed a $60.5 million acquisition loan for Liv Goodyear, a brand-new, Class A, multifamily apartment community.

Located at the southeast corner of West Virginia Avenue and 153rd Drive in one of the fastest-growing cities in Arizona, Liv Goodyear is a 326-unit institutional-quality apartment community offering cutting-edge amenities and meticulously groomed grounds.

“We’re thrilled to be part of a project like Liv Goodyear which is on the leading edge of modern, luxury apartment living,” said Vin Basa, vice president at Tower Capital.

Accessible via Interstate 10, Loop 303, Loop 101 and the upcoming Loop 202 South Mountain expansion, the apartment homes at Liv Goodyear offer nine-foot ceilings, beautifully appointed kitchens, wood-style plank flooring, spacious walk-in closets, and private patios or balconies.

Outdoors, residents can enjoy a resort-style saltwater pool and spa, barbecues, gaming and social areas, and a sand volleyball court. In the heart of the community is a resident clubhouse, a 24-hour, state-of- the-art fitness center, a tranquil community garden, playground, and splash pad, as well as the security of controlled access gated entry, covered parking and garages.

The deal at Liv Goodyear contributes to a record-breaking quarter for the company, which is on track to close $250 million during the final months of 2019. The company also broke its annual record, closing on more than $400 million this past year.

“Closing this loan has been a terrific capstone for 2019,” said Adam Finkel, principal at Tower Capital and member of Forbes’ Real Estate Council. “Our vision for the year ahead includes growing the firm, continuing to increase our market share, and most importantly offering expert service to our clients.”

The professionals at Tower Capital have a diverse background, having participated in almost every area of the commercial real estate industry including real estate brokerage, mortgage banking, securities, private lending, and development – across all real estate asset classes. The company was recently recognized by National Real Estate Investor as a ‘Top Financial Intermediary’ for total dollar volume of commercial real estate loans arranged.

Since 2015, Tower Capital has been involved in close to $1 billion in successful debt and equity placements on behalf of investors across all major asset classes. 

By Kelsi Maree Borland | December 26, 2019 at 04:00 AM

Read entire article on Rose Law Group Reporter

About Tower Capital:
Tower Capital was founded to enable owners of commercial real estate to achieve their investment goals with the least amount of time, energy, and cost, while creating surety of execution and peace of mind.

Established in 2015 and headquartered in Phoenix, Arizona, Tower Capital provides customized structured financing to investors throughout the United States. We specialize in debt and equity placement ranging from $2 Million to $100 Million and have financed over $700 Million for our clients since inception. We focus on independent financial advising with an entrepreneurial mindset, market vigilance and personalized attention to every client.

Tower Capital Secures a $60M Loan for Liv Goodyear

The funds were used to acquire a brand-new, class-A, multifamily apartment community.

class-A, multifamily apartment community. The deal at Liv Goodyear contributes to a record-breaking quarter for the company, which is on track to close $250 million during the final months of 2019. The company also broke its annual record, closing on more than $400 million this past year.

Located at the southeast corner of West Virginia Avenue and 153rd Drive in one of the fastest-growing cities in Arizona, Liv Goodyear is a 326-unit institutional-quality apartment community offering cutting-edge amenities and meticulously groomed grounds.

By Kelsi Maree Borland | December 26, 2019 at 04:00 AM

Read entire article on GlobeST.com

About Tower Capital:
Tower Capital was founded to enable owners of commercial real estate to achieve their investment goals with the least amount of time, energy, and cost, while creating surety of execution and peace of mind.

Established in 2015 and headquartered in Phoenix, Arizona, Tower Capital provides customized structured financing to investors throughout the United States. We specialize in debt and equity placement ranging from $2 Million to $100 Million and have financed over $700 Million for our clients since inception. We focus on independent financial advising with an entrepreneurial mindset, market vigilance and personalized attention to every client.

Tower Capital Sees Surge In Loan Volume

The firm closed a record-breaking $70 million in the last 30 days, and is also on track to break an annual record.

Phoenix-based Tower Capital is seeing a surge in loan activity. The company has closed a record-breaking $70 million in deals in the last 30 days, and is on track to break an annual record as well. Tower closed a total of eight deals, including a $17.3 million 10-year loan for Resort on 35th Avenue with a 3.79% interest rate.

“Our strong activity over the past 30 days has been driven by robust investor demand coming to Phoenix from other markets, such as California and Denver, where cap rates and yields are much lower,” Kyle McDonough, principal at Tower Capital, tells GlobeSt.com. “Arizona is benefiting from some of the highest population growth in the nation, creating continued demand for housing and driving up rental rates and property values.”

Read entire article on GlobeST.com

About Tower Capital:
Tower Capital was founded to enable owners of commercial real estate to achieve their investment goals with the least amount of time, energy, and cost, while creating surety of execution and peace of mind.

Established in 2015 and headquartered in Phoenix, Arizona, Tower Capital provides customized structured financing to investors throughout the United States. We specialize in debt and equity placement ranging from $2 Million to $100 Million and have financed over $700 Million for our clients since inception. We focus on independent financial advising with an entrepreneurial mindset, market vigilance and personalized attention to every client.

Tower Capital Reports Nearly $70 Million in Closings in Past 30 Days

Phoenix, Arizona – It was a stellar month for Tower Capital Organization, an independent structured finance firm based in Phoenix. In the last 30 days alone, the company closed nearly $70 million in loan volume across eight properties in the Southwest.  

Tower Capital closed loans across eight properties in Arizona and California. The largest deal last month, Resort on 35th Avenue,is a $17,250,000 10-year loan that closed at a competitive rate of 3.79%. The 272-unit, garden-style apartment complex is located in Phoenix on a 9.79-acre site. It features a clubhouse, tennis and volleyball court, three swimming pools, a spa, two laundry facilities and high-speed internet access. The loan is earmarked for capital improvements including an exterior facelift and rebrand, along with interior renovations in many of the units.

In addition to Resort on 35th Avenue, Tower Capital and its affiliates secured capital for the following projects in the past 30 days:

Casa Sol – $15,390,000 acquisition: A 248-unit multifamily property in Phoenix.

The Park on 57th Avenue – $10,750,000 cash-out refinance: A 128-unit garden-style apartment complex in Glendale undergoing extensive exterior and interior renovations.

Fairfield Inn Scottsdale – $7,500,000 acquisition and renovation: A well-maintained, three-story, 131-key, hotel in North Scottsdale with major renovations planned.

Axis off McDowell – $5,625,000 refinance: A72-unit garden-style apartment complex in Phoenix that recently completed an exterior facelift and interior renovations in many of the units.

Downtown Scottsdale Assemblage – $4,755,000 acquisition/assemblage: Comprising seven multifamily properties totaling 23 units, located on the northern boundary of Scottsdale’s Entertainment District. One of the last areas of downtown Scottsdale that has yet to undergo redevelopment, Tower arranged for its client to acquire the seven properties from six different sellers over a one-month period through multiple escrows under one loan.

Quail Springs Village – $3,500,000 acquisition: A75-unit multifamily property located in Joshua Tree, Calif., with light renovations planned across the complex.

29 Palms – $1,406,000 acquisition: A 53-unit, multifamily property located in Tucson with light renovations planned throughout.

The professionals at Tower Capital have participated in almost every area of the commercial real estate industry including real estate brokerage, mortgage banking, securities, private lending, and development – across all real estate asset classes. The company was recently recognized by National Real Estate Investor as a ‘Top Financial Intermediary’ for total dollar volume of commercial real estate loans arranged.

On the heels of a record-breaking month, Tower Capital and its affiliates are on track to break an annual record, too.

“We are proud to report that we expect to hit more than $400 million in loan volume by the end of 2019,” said Tower Capital Principal Adam Finkel, who serves on Forbes’ 2019 Real Estate Council.

“We continue to work toward growing our market share, honing our processes and exceeding our clients’ expectations, and aim to knock it out of the park again next year,” said Kyle McDonough, principal at Tower Capital.

Since 2015, the firm has been involved in close to $1 billion in successful debt and equity placements on behalf of investors across all major asset classes. 

About Tower Capital Organization

Tower Capital Organization was founded to enable owners of commercial real estate to achieve their investment goals with the least amount of time, energy, and cost, while creating surety of execution and peace of mind. Established in 2015 and headquartered in Phoenix, Arizona, Tower Capital provides customized structured financing to investors throughout the United States. Specializing in debt and equity placement ranging from $2 Million to $100 Million, Tower Capital has financed more than $700 Million for clients since inception. Tower Capital focuses on independent financial advising with an entrepreneurial mindset, strategic team approach and personalized attention to every client. For more information about Tower Capital, please visit: https://towercapllc.com/

Read entire article on Commercial Executive Magazine

About Tower Capital:
Tower Capital was founded to enable owners of commercial real estate to achieve their investment goals with the least amount of time, energy, and cost, while creating surety of execution and peace of mind.

Established in 2015 and headquartered in Phoenix, Arizona, Tower Capital provides customized structured financing to investors throughout the United States. We specialize in debt and equity placement ranging from $2 Million to $100 Million and have financed over $700 Million for our clients since inception. We focus on independent financial advising with an entrepreneurial mindset, market vigilance and personalized attention to every client.

Adam Finkel named as “People to Know in Commercial Real Estate”

Adam Finkel named in AZ Big Media Magazine as one of the “People to Know in Commercial Real Estate”

This year’s edition of the People & Projects to Know in Commercial Real Estate paints a very clear picture of a market that is becoming more diversified and a market that has a deep pool of development and talented people to push that development forward.

View article online: AZ Big Media

Multifamily Development Financing: Lenders Jockey for Position

The players in the multifamily development financing space are mostly the same, but how their pros and cons work out in practice continues to change.

As the sources of multifamily development financing—debt and equity—jostle for business, their strategies and products continue to evolve. These shifts have allowed debt funds to become more prominent capital sources and life insurers to strengthen their share of the market. In the meantime, commercial banks remain the primary source of debt for new multifamily projects.

On the equity side, investors are more inclined to seek a preferred debt position in the capital stack than an equity slot. Meanwhile, falling interest rates, the mutable role of CMBS, Opportunity Zones and the London Interbank Offered Rate phaseout are changing the game for developers looking for financing.

HIGH FIDELITY

When it comes to debt, commercial banks are recognized as the biggest source of financing for multifamily construction, according to Jay Maddox, principal with Avison Young in Los Angeles. Banks have returned to the main stage of multifamily development lending after pulling back three years ago due to overbuilding concerns. However, debt funds—such as Colony Capital and Square Mile Capital—are becoming more important as they offer more flexibility on terms and, typically, non-recourse loans, in response to which some banks have loosened their lending criteria.

In permanent financing, banks are also primary, along with Fannie Mae, Freddie Mac and the U.S. Department of Housing and Urban Development. Jeff Fastov, senior managing director at Square Mile Capital in New York, agrees with the hierarchy and outlines the fact that government-sponsored enterprises are not focusing on development currently.

In addition, “life insurance companies have become very aggressive” with respect to pricing and the result is that “a multifamily borrower has an increased selection of options now,” Maddox explained.

Alternative lenders like Square Mile, Fastov explains, focus more on the project itself: “We’re just making investments for funds.” The advantages of private players are the higher loan-to-value ratios and the shorter closing periods as opposed to traditional lenders, which thrive by fostering long-term relationships with borrowers.

Kyle McDonough, principal at Tower Capital in Phoenix, confirms that banks continue to prefer developers they already work with. Multifamily development is booming in metro Phoenix, and there’s lots of bank financing, but those banks “are laser-focused on the sponsor and their track record.”

ALTERNATIVE PARTNERSHIPS

The deal flow is so high that many banks have upped their minimum loan amounts, according to McDonough, who also emphasizes that banks still prefer recourse debt, though this typically burns down as stabilization hurdles—such as debt service coverage ratio thresholds—are met.

Fannie Mae and life insurers both focus on longer-term debt financing. “Fannie Mae’s competition with life insurers is mostly in the low-leverage space. Life insurers tend to focus on multifamily commitments with loan balances of $15 million or higher,” a Fannie Mae spokesperson told Multi-Housing News.  

Unlike banks, some life companies offer a participating mortgage. McDonough cites as an example Principal Real Estate Investors’ participating construction permanent program, under which the company provides up to 85 percent of the capital stack for a multifamily or industrial property. The borrower receives at least 51 percent of the property’s cash flow, while retaining more control than in a typical joint venture structure.

In joint ventures and other preferred equity, the private equity funds are the big players. A typical multifamily development would see a joint venture with 65 percent debt and 35 percent developer and equity investor (about 80 to 90 percent from the latter). In a twist, however, through seeking to reduce their risk, many equity investors are leaning toward preferred debt positions instead, according to Maddox. Family offices and high-net-worth individuals are also active on the equity side.

THE CMBS BOOST

CMBS was a big factor in multifamily loans prior to the recession, but now, their pricing is “not competitive regarding most multifamily projects,” Maddox explained. Moreover, they generally present onerous documentation requirements.

However, CMBS activity in the sector is expected to pick up significantly in the last quarter of 2019 as GSEs have slowed down since August, because they started running out of their annual allocations earlier than expected, McDonough says.

The recent interest rate cuts got some attention from borrowers and lenders. Mike McRoberts, a managing director at PGIM, notes that as interest rates come down, it becomes easier to make a deal work, though overall, the economic situation is not especially sensitive to interest rates right now. As a consequence, banks are starting to use floor rates and executives in the business expect this trend to grow.

HEADWINDS AHEAD

Opportunity Zones have not yet generated much momentum in the multifamily sector. Even though the industry recognizes the concept as necessary, given the shortage of affordable housing, there are still many questions that need to be answered. Underwriting is one aspect that is more problematic for OZ projects. McRoberts predicts that each specific zone will need one or more “stable anchors” in the form of a multifamily, office or retail project to get things rolling.

“We’re indifferent to them,” Fastov said, because Square Mile’s investors (such as pension funds and sovereign wealth funds) don’t pay taxes anyway. Fastov did express some concern that development decisions based on tax benefits tend to drive values up, and from a lender’s perspective, a higher loan per square foot increases volatility. “You’d rather have a lower loan per square foot, all other things being equal,” he cautioned.

Tower is working on an OZ multifamily project. “It’s extremely sponsorship focused,” McDonough added. Given the rules on OZs, “you’re going to be married to that person for 10 years,” he said.

The looming phaseout of the LIBOR index poses another complication for multifamily development financing. Many loans don’t have the language for alternative indexes, McRoberts points out. “The big institutions are taking this very seriously,” but smaller players could have problems because they’re not prepared.

“The goal is to mimic what LIBOR had done,” Fastov said, aiming to avoid basis risk. “The whole world is working to get this right.”

Though most borrowers are aware of the uncertainty around a LIBOR-indexed transition, many lenders and the GSEs continue to offer LIBOR-indexed multifamily lending products. “The recent flattening in the yield curve has appeared to have more of an impact in moving borrowers away from floating-rate executions [than concern about LIBOR has],” a Fannie Mae spokesperson told MHN.

As to the future, Fannie Mae reports that life insurers’ loan volumes are increasing slightly year-over-year. Fastov predicts that going forward, both debt funds and GSEs will be increasing their market shares.

McDonough expects that multifamily financing overall will remain plentiful. “Everybody’s trying to get it out the door.”

Read entire article on MHN

America’s Commercial Real Estate Podcast

Adam Kinkel offers great insight on the “Commercial Real Estate Financing” show.

Finance can be a barometer for future activity in real estate, and lower interest rates and a prolonged cycle are generating interest in the debt market. Michael and his guests discuss the impact of lowered rates, lender sentiment, and tips for commercial real estate and SBA loans.

Click here to view the podcast

11 Tips For Building A Real Estate Brokerage Firm From The Ground Up

If you’ve worked as a real estate broker, you may have considered starting your own brokerage firm. Opening your own firm can lead to increased freedom as well as financial opportunity. However, like any entrepreneurial endeavor, building a company from the ground up can be a daunting task.

Members of Forbes Real Estate Council know about the challenges of establishing a new firm—as well as how to overcome those challenges successfully. Below, members share the most important things to remember when starting your own real estate brokerage. Here is what they advise:

5. Commit To Your Clients

When building a brokerage firm from the ground up, it is important to always maintain a commitment and focus on the client. Building a brand reputation is key in the early stages of any business. By maintaining a client-centric approach and executing beyond expectations, a new brokerage firm is sure to gain market share through repeat business and referrals. – Adam FinkelTower Capital, LLC

Read entire article on Forbes

Phoenix Sees Surge in Capital Placement at Start to 2019

Tower Capital closed $27 million in transactions the first quarter, and have $150 million built up in the pipeline to close in the second quarter.

At the start of the year, there was strong capital activity in the Phoenix market. Tower Capital, for example, closed $27 million in capital transactions and has another $150 million in the pipeline to close in the second quarter. According to the firm, low interest rates, strong population growth and out-of-state investment—thanks to higher yields than in other markets—is driving the increased capital activity in the market.

“There is significant demand from both local investors who can locate the hard to find off-market deals that others may miss, along with significant demand from out of state investors,” Adam Finkel, principal at Tower Capital, tells GlobeSt.com. “We are seeing tremendous activity from investors throughout California, Vancouver, and Toronto, where cap rates are incredibly low. Phoenix has many strong economic drivers as well as warm climate, which keeps activity strong.” Tower’s transactions in the first quarter include acquisition financing, cash-out refinancing and bridge deals. The volume is significantly higher compared to the start of 2018 and higher compared to the company’s historical average. “Our deal volume is up significantly over last year, which was already a stellar year for production,” says Finkel. “This year we have consistently had three to four time more transactions in closing than our historical average, and as soon as one closes another one takes its place. The number of capital advisors we have has grown as well, contributing to the increase in production. But anecdotally all of our capital partners seem to be incredibly busy right now. Last year Tower Capital closed just under $200 million in loan origination volume and this year we anticipate $300-plus million.” Most investors are taking advantage of the low interest rate environment, and Finkel says that most clients are looking to lock in low rates. “Most investors realize we are in an incredibly low interest rate environment,” he says. “On stabilized assets, our clients are mostly seeking to lock in long term, low interest rates, with possibly some interest-only payments on the front end to increase cash flow, which can be applied towards property renovations. In addition, the demand for bridge loans on value-add repositionings is very high.”

This has also fueled the market for redevelopment projects and construction financing. “We are still seeing many older, or partially-renovated properties, being given much higher end capital improvement packages than we have seen people get away with in past years,” says Finkel. “Now that we are in a more mature market cycle, the value-add investors really need to step up their game in order to attract the higher paying tenants over their area competitors. The bridge lending space is extremely competitive right now and we have numerous options for these types of projects.”

Looking ahead to the second half of the year, Finkel expects the activity to remain strong, especially as the economy is expected to remain strong and interest rates low. “Despite political uncertainty, the overall economy is strong and the local Phoenix economy is very strong,” he says. “As long as interest rates remain low I do not foresee the activity subsiding in the second half of 2019.”

By Kelsi Maree Borland | May 14, 2019 at 04:00 AM

View article online: GlobeST.com

Tower Capital Closes More Than $27 Million at the Beginning of Q2

Tower Capital has had a tremendous start and has closed a variety of deals totaling over $27 million. The team also has a pretty robust pipeline for the rest of Q2 and are expected to close over $150 million or more. I’ve included the most recent deals below for your reference.

View article online: Commercial Executive Magazine