Tower Capital successfully arranged $67,400,000 in non-recourse construction financing for a 285-unit Build-to-Rent (BTR) community in Phoenix, AZ. The gated development is located in the rapidly growing Laveen Village submarket, near job centers and the new Loop 202, Phoenix’s newest stretch of freeway.
The subject property will be situated on 24.28 acres, with an average unit size of 933 square feet. The one-story project is designed to include one-, two- and three-bedroom layouts with such amenities as a resort-style swimming pool with jacuzzi, BBQ, ramada, fitness center, detached garages, storage units, dog park, dog spa, EV charging stations, private landscaped backyards, in-home pet doors, and smart home technology. Construction on the development is slated to conclude by December 2024.
Since the submarket has few multifamily properties with the projected rents, the capital provider and appraiser required extensive market comparable data to support the underwritten rents. Tower’s expertise and track record in the build-to-rent segment helped the lender and appraiser to get comfortable with the deal. They recognized that the sponsor’s business plan was anchored on a familiarity with the submarket, and it brought demonstrated success with past build-to-rent developments.
The sponsor, a local developer with significant knowledge and experience within the Phoenix market, recognized the need for high-quality product in a supply constrained market. Tower was able to leverage market interest to secure the most competitive terms available by focusing on the desirable location as well as the sponsor’s track record and familiarity with the high-growth market.
Tower Capital has successfully closed more than $750 million in financing transactions for Build-to-Rent product and continues to be a leader in the marketplace with another $500 million of projects in the pipeline. The firm has closed more than 5,000 units and 30 communities spanning multiple states including in Arizona, Texas, Alabama, and North Carolina.
