Financing Amount:
Nogales, AZ
Capital Source:
Local Credit Union
Transaction Details:

Tower Capital recently facilitated $3,850,000 in acquisition financing for the acquisition of the two-story, garden-style, 128-unit Santa Carolina Apartments located in Nogales, AZ. The 5-year fixed rate loan will provide the borrower with permanent, fixed rate debt at a low interest rate of 3.75%.

The 100% affordable property was built in 2005 and sits on a 6.25-acre lot. The property features common area amenities including a playground, community room with computer and internet access, a laundry facility, and a fitness center. The units are spacious, featuring a 928 square foot two-bedroom unit and an 1,100 square foot three-bedroom unit with walk-in closets. The unit mix is 50/50% one-beds and two-beds.

Situated 50 miles south of Tucson, AZ and 150 miles southeast of Phoenix, the city of Nogales is the county seat and principal city of the Nogales, AZ Micropolitan Statistical Area. Home to over 20,000 residents, Nogales serves as a gateway for international trade and is a major link in the CANAMEX Trade Corridor, which is a western transportation corridor connecting Canada, the U.S., and Mexico. The city’s strategic location along the U.S. and Mexican border provides excellent opportunities for shipping and distribution, retail trade, manufacturing, and tourism. This assignment was especially challenging given that the asset is 100% affordable and situated in a tertiary market that doesn’t meet the geographic investment parameters for most lenders.


The fact that the property is located in a tertiary market and is also encumbered by a LURA made the lending pool very small for this transaction. Tower Capital was able to leverage its relationships to procure a local credit union who was comfortable with the area. After an appraisal came in unexpectedly low, the advisor at Tower worked closely with he lender and appraiser to have adjustments made and limit any loss of loan dollars incurred.

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