Hackensack, NJ, June 03, 2008 – Imagine a collection of retreat homes on one to five acres waiting to be built in a North Carolina mountain-ridge setting. Imagine the frustration of developers waiting for a loan from traditional lenders in order to make this a reality. That is what increasingly faces today’s building sector and that is why High Grove Development Group, LLC (Legasus Properties, LLC), turned to Hackensack’s direct lender Kennedy Funding, Inc. for borrowing needs.
Kennedy recently closed on a $9.54 million loan to High Grove whose principals are Robert A. Corliss and Theodore C. Morlok. Based in North Carolina, High Grove plans a 500-acre upscale community – High Grove Estates – at the foothills of the fabled Great Smokey Mountain range. They needed a loan in a short amount of time to proceed with work on 91 lots in the first phase of the development that will set the stage for another 85 lots to be developed eventually. The good news is that 13 of the first 91 homesites already have buyers. The difficult news was that the traditional loan was not forthcoming.
Kennedy was able to provide the funds in short order. On the same day as the High Grove closing, the same developers closed with Kennedy on a $20.5 million loan for their River Rock community 40 miles to the south in Cashiers, NC. Both communities are a short drive from major North Carolina cities and from Atlanta.
High Grove put up the unsold 78 lots – part of a 700-plus acre tract in Whittier’s Barkers Creek area –as collateral. With Kennedy’s help, Corliss and Morlok are now able to refinance High Grove’s current debt and to complete underground utilities for the 78 already platted lots, increasing their attractiveness to the affluent population looking for mountain residences. With a topography that features an elevation exceeding 2,000 feet in some sections, buyers will be able to achieve their goals. Combining the natural beauty of aged trees and grassy areas, the land presents rustic, natural beauty.
“Looking at the property and its current value and development attributes,” says Jeffrey Wolfer, Co-CEO of Kennedy Funding, “we did not hesitate to provide the loan as quickly as possible. Our confidence in the developers’ reputations and their enthusiasm for the project, combined with the financials and our field evaluation of the raw land collateral, let us know that this was a good risk.
Kennedy Funding has developed a reputation for stepping in where traditional lenders are refusing to tread. Moving quickly to close on a loan can also mean moving carefully. The multi-layer company structure is in place to put an evaluation team on the job immediately. It is not unusual for a loan to close within days of initial application if the pieces fit.
The pieces clearly fit for Legasus and they plan to renovate a Red Barn Community Center, complete the Tennessee Top Overlook Pavilion with spectacular vistas, and finish the roads and bridges throughout the property.
Kennedy Funding has built a reputation on recognizing the value of raw land collateral and the value added through development. High Grove Estates is no exception.
Says Wolfer, “Of course the numbers are important but we don’t limit our look to the numbers. Each borrower is unique. Each vision is unique. Our team calls on its experience over 20 years, dealing with the spectrum of borrowers in the spectrum of economic environments, allowing us to utilize a flexibility and fulfill the majority of borrowers’ needs.
Where traditional lenders are turning away qualified borrowers with viable collateral, producing long delays for loans and blocking or even suspending projects, Kennedy funding has eased the process. The company often can commit to a loan in two days and close in five, with a loan-to-value ratio that can reach 65%. Kennedy is able to call on a deep source of capital to provide hard money, bridge loans, bank workouts, and to deal with foreclosures and bankruptcies.
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