THE DEN, 2510 Channing Way, Berkeley, CA 94704
$27,000,000 Cash-Out Refi Perm Debt
160-Bed / 40-Unit Mixed-Use Student Housing Property in Berkeley, CA
Highland Realty Capital has arranged $27M Cash-Out Refi Perm Debt for THE DEN, a 160-bed / 40-unit mixed-use student housing asset featuring +/- 2,500 sf of ground-floor retail. THE DEN is located in the heart of Downtown Berkeley, at Telegraph Avenue and Channing Way, just two blocks from campus.
Highland identified a balance sheet lender that recognized the superior quality of the construction and the extreme supply/demand imbalances of the Berkeley student housing market and was able to get comfortable with the high loan basis and asset value per unit. The non-recourse permanent loan is fixed for 12 years priced in the low 3%’s, featuring 5-years of Interest Only. The loan was sized to $675,000/unit and nearly 100% of development costs.
The perm loan represents the third financing that Highland has successfully arranged for this asset on behalf of the Sponsor. The first financing was a 70% LTC Land Acquisition/A&D Loan in 2017. In 2018, Highland arranged a $24M construction loan which represented 87% of the then-actual project costs. The construction loan was sized to $600,000 per unit at a spread in the mid 300’s over LIBOR.