Tandem Development has landed a pair of loans to refinance an existing community and fund the construction of a new multifamily project in Chicago. Draper and Kramer Inc. arranged the $114 million in construction and refinancing loans, which were provided by the U.S. Department of Housing and Urban Development.
The approximately $114 million in financing was divided amongst two projects, where $58.4 million was a construction loan for Tandem Development’s 18-story mixed-use multifamily project, and the remaining $55.6 million went towards a refinancing of a construction loan for Tandem Development’s 23-story mixed use community. Draper and Kramer’s Matt Wurtzebach led the team that arranged the financing.
Tandem Development is currently working on 1044 W. Van Buren in Chicago’s popular West Loop neighborhood. The developer started construction on the multifamily project in April and is expected to complete it in the second quarter of 2023. The project will be getting some help through HUD’s 221(d)(4) program that offered a 40-year loan term with a 40-year amortization at 78 percent loan to cost.
The development is expected to offer 196 units and common amenities including a fitness center, coworking lounge, sky lounge, game room, and deck area with fire pits and grilling stations. Tandem Development is also constructing 1044 W. Van Buren with 78 on-site parking spaces, 143 bike parking spaces and 1,775 square feet of first-floor retail space.
REFINANCING THROUGH HUD’S 223(f) PROGRAM
Draper and Kramer also arranged a non-recourse construction loan refinance through HUD’s 223(f) program, which is usually used by affordable housing projects, for Tandem Development’s Avenir Apartments. Wurtzebach arranged the 35-year term loan with 35-year amortization, adding in prepared remarks that the HUD program can also provide competitive fixed-rate financing for market-rate properties. According to Yardi Matrix data, the previous construction loan for the community was a $48 million loan from Fifth Third Bank.
Tandem Development completed the 23-story mixed-use community in 2019. Avenir Apartments also has 196 units but select studios offer Ori robotic furniture that can transform a bedroom into office or living room space by pressing a button. The community’s amenities include an outdoor pool, gym, party room, demonstration kitchen, coworking lounge, cabanas, fire pits and grilling stations. The property also includes 83 garage parking spaces and 32,558 square feet of commercial space. The community is 95 percent occupied.
Besides Avenir Apartments and its ongoing work on 1044 W. Van Buren, Tandem Development has worked on several other projects in the city. The Chicago-based company does everything from construction and property management to development and architecture. Last year, Tandem Development completed its Avra West Loop project that’s a block away from 1044 W. Van Buren.