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Walker & Dunlop Investment Partners has closed its first evergreen debt fund to focus on multifamily bridge financing.
The fund has $157.5 million in equity commitments and will support loans of $450 million to $600 million, with up to 75% stabilized loans in the $10 million to $100 million range. The company intends to originate senior secured bridge mortgage loans with a to value, the press release states.
WDIP began investing from the fund in December and has already used it to finance three properties in Minnesota, Texas and Pennsylvania.
This fund is the company’s first, but it won’t be its last. WDIP plans a series of similar funds to finance Class A multifamily assets across the country, a spokesperson said. Bisnow.
Multifamily tenant demand remains strong, as evidenced by fourth-quarter net absorption of 84,800 units, four times higher than pre-pandemic levels, according to CBRE, but construction completions were even stronger. It is said that Developers delivered 140,000 units in the fourth quarter, bringing the total for 2023 to 416,500 units. This is the highest amount since CBRE began tracking the market 27 years ago.
Meanwhile, the sector is recalibrating in the face of headwinds. In 2023, his investment amount decreased by 60%. This is likely due to rising interest rates and construction costs, as well as falling rents. Rents fell 1.2% sequentially in the fourth quarter and are expected to decline for the remainder of 2024. Fitch predicts the number of apartment defaults will double this year.
WDIP’s announcement comes as Carlyle Group co-founder David Rubenstein said Monday that he is launching a fund with Declaration Partners and hopes to raise $400 million to invest in multifamily and industrial assets. It was carried out following.
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