Emeral Capital
New England's Premier Private Real Estate Lender

Client Success Story: Charlestown, MA

November 22, 2019


Location:         Charlestown, MA

Loan:               $1,660,000

Type:               Refinance and renovate – condo conversion of a 3-unit

We were excited to take a look at this loan request because of the proximity to downtown Boston and to lend to a borrower of this caliber.  He is a seasoned investor doing several projects a year in the Boston area.  The deal came to us in early October needing to close no later than 10/15/19.

The borrower had used another private (hard money) lender to purchase this building in 2018 with a 12-month loan.  Unfortunately, a variance was needed from the City to build off the back of the building.  The variance process alone took 12 months and the loan expired.  As a result, the borrower came to us looking for a refinance to payoff the 1st loan and fund the remaining $460,000 of renovations.  To-date, approximately $160,000 has been spent on demo and the addition.   

The borrower’s plan is to finish the renovations and convert to condos, a common ‘play’ in the Boston market with investors.  His projected resale total is $2.5m on the 3 condos.  EMCAP reviewed the sold comps in the map below, which shows plenty of sales.  While our value assumption is slightly lower than the borrower’s, the ARV (After-Repaired-Value) ratio is still under our 70% threshold.  Beyond meeting our ARV marker, the borrower’s cash investment in the deal puts the LTC (Loan-to-Cost) at 83%, just under our 85% target.

In conclusion, the deal was approved because of location, valuation, and strength/experience of the borrower.  We met his 10/15/19 deadline to close.

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