UPDATED, Nov. 12, 5 p.m.: Apartment developers are facing all sorts of obstacles, from high land costs to supply-chain bottlenecks pushing up material prices, but construction financing is not one of their stumbling blocks.
Loans for new rental projects have been flowing, with Delray Beach-based MAG Real Estate & Development the latest to score. The company nabbed $61.5 million in financing for its 228-unit project in Pompano Beach, according to Maher Hanna, MAG founder and owner.
An affiliate of real estate private equity firm Madison Realty Capital was the lender, records show.
Jay Miller and AJ Felberbaum of BayBridge Real Estate Capital brokered the deal on behalf of MAG Real Estate.
The pair of eight-story buildings, called Aviara East Pompano, are planned to rise on 5.1 acres at 1621 South Dixie Highway, or the southwest corner of West McNab Road and South Dixie Highway West. The project is expected to include ground-floor retail, according to MAG’s website.
MAG Real Estate bought the property in 2017 for $2.1 million, records show.
The Pompano Beach City Commission in 2019 rezoned most of the site – long a scrapyard, including for old cars – to allow for the apartment project.
MAG Real Estate used its completed 36-unit condominium and townhouse community in Lake Worth Beach as collateral for the construction loan, Hanna said.
Aside from rentals, condos and townhouses, MAG also builds commercial projects and has a construction management division, according to its website.
The multifamily market has been more than robust this year, fueled by demand from locals and South Florida newcomers who flocked to the region partly for its early reopening following the pandemic shutdown.
Lenders have been quick to respond, allowing construction financing to flow.
Just this week, Miami-based Alta Developers scored a $77.1 million construction loan for a 296-unit multifamily building just outside Pinecrest. And Miami-based Melo Group scored $75 million to help bankroll the construction of its second apartment project in downtown Miami.