Condominiums in Grand Haven, Michigan

Saturday, May 25, 2019
Borrower   A special-purpose entity set up for the transaction
Loan   $5,500,000 three year loan at 12% the first year 15% the second, and 18% the third year
Collateral   a first lien on a 20-acre site in Grand Haven, Michigan. On the site is a half-built complex of 19 apartment buildings, a clubhouse, pool and other amenities.
Guarantors   The three principals, whose combined net worth is some $40 million. The guaranties are on a "good guy" basis.
Purpose   The borrower plans to use the proceeds to purchase the site for $9.1 million. The Borrower will put up some $4 million needed to close. The complex will cost some $4.6 million to complete. We are assured that the borrowers have these funds arranged.
Exit strategy   The Borrowers plan to complete the development, and sell the units as condominiums. This will require upgrading of existing units, which were built as rentals.
Outcome   The loan has been repaid in full.

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