This second trust deed is collateralized by a nearly 100,000 square foot, former Quality Inn hotel that has begun the transformation into a 65-unit apartment building. This apartment building will fill a void in the marketplace for market rate, workforce housing. Originally constructed in 1972, this block building has been operating as various brands of hotels and motels. Due to the pandemic and a multitude of macroeconomic events over the past few years, hotels have taken a bit of a hit forcing a consolidation in the industry. By converting the property into its highest and best use as an apartment building, it will bring new life and economic opportunity to the asset. After the conversion is completed, net rents are anticipated to be in excess of $300,000 annually.
Loan Amount: $575,000
Yield: 13% Interest is paid monthly in arrears with payments due on the 1st of each month with a 10-day grace period.
Term: Nine months with an optional nine-month extensions at maturity.