West Palm Beach, FL, February 3, 2007 — Kennedy Funding, Inc. of Hackensack, NJ, the industry’s leading direct private lender, has closed a $23.3 million loan to Trinity Development Partners, LLC for a waterfront real estate purchase in West Palm Beach, Florida.
The owners of the 119 units had each found their own piece of waterfront paradise in the tallest building in Florida’s sought-after West Palm Beach. But back-to-back Hurricanes Frances and Jeanne pounded the area relentlessly in 2004, and Hurricane Wilma added further damage in 2005, turning the 30-story dream community into a nightmare of a business deal for all those involved. With their building vacant, uninhabitable and boarded up, residents faced yet another setback—insurers paid only $2 million of repair costs projected to exceed $20 million.
The most appealing option was to sell. Yet one deal after another fell through, despite the interests of several well-known developers. Lenders seemed unwilling to fund a project with so many complications, such as using land and a heavily damaged building as collateral. The homeowners’ association was desperate. Out of time and money, they reduced the asking price in hopes of finding a buyer who could close fast.
Enter Trinity Development Partners. Along with equity partner Stillwater Capital Partners, a NY-based hedge fund, they were confident that the complex could thrive again. Uncertain whether they would ultimately renovate the building or have it demolished and rebuilt, they were determined to make 1515 South Flagler Drive a highly desirable and highly marketable property once again. All they needed was a loan.
Fortunately, Kennedy Funding of Hackensack, NJ, shared their vision. While countless lenders had passed on this severely damaged and outdated property, Kennedy saw the potential in its location and in the plans of the developers. “Between the nature of the property and the hi-rise condo market in Florida, most lenders wouldn’t have gotten past the first few lines of the application,” says Jeffrey Wolfer, President and Co-CEO of Kennedy Funding. “That’s where it starts getting interesting for us. We recognized they not only had a viable plan, but had also identified the continued strength in the higher end of the market.”
Naturally, there were complications to the loan. To renovate or rebuild, changes would need to be made to the building’s mid-1970’s design. To meet new codes, requirements and expectations, additional square footage would be needed, parking spaces would need to be added and ceiling heights of the individual units would need to be increased. “With this many unique and unusual circumstances, a loan like this wouldn’t meet the criteria of traditional lenders,” continued Wolfer. “That’s why it’s called situational lending—we consider each situation individually and evaluate it as such.”
With plans in place, Kennedy came through with a loan for $23,300,000. Coordinating the sale of 119 units is quite complex—and tedious. The process involved many people and many hours of work, with each change requiring revisions to the 119 individual contracts, many of which had to be handled electronically or through overnight delivery. Kennedy helped make it happen quickly and smoothly and the property will soon be on its way to being the pre-eminent West Palm Beach address.
Kennedy Funding can issue loan commitments in as little as 24 hours, which often leads to closings in as little as five days. In some cases, when time is unusually critical, deals can be closed even quicker. Available financing ranges from $1 million to $100 million and more.
While specializing in commercial real estate bridge loans, Kennedy’s flexibility and diversity have also resulted in loans for a wide range of enterprises, including amusement parks, high-profile golf courses, TV and radio stations, airlines, even sports complexes. Throughout the world, Kennedy has produced funds for conventional and unconventional projects, often succeeding where other financial institutions cannot. Kennedy can fund up to 75% loan-to-value for commercial land development, acquisitions, workouts, refinancing, bankruptcies and foreclosures.
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