Beachwold Residential has taken a $302.2 million Freddie Mac refinancing package for 10 communities across the state of Connecticut. The portfolio totals 2,286 units, of which more than 75% qualify as affordable housing units under Federal Housing Finance Agency guidelines. Walker & Dunlop structured the new mortgage, which locks in a fixed interest rate while increasing loan proceeds.
The communities within the portfolio range in size and age, with the oldest — 278 Main in West Haven — constructed in 1926 as a schoolhouse, then later converted into a multifamily property. The asset features studio to three-bedroom floor plans between 436 and 1,354 square feet.
Another property, Lofts at the Mills, is located at 91 Elm St. in Manchester. The community was, as its name implies, originally a mill in the early 20th century. Public records indicate the community changed hands in 2005, when Beachwold paid $21.3 million for the 220,000-square-foot property.
Connecticut’s Affordability Crisis
While Connecticut’s cities may not at first glance be facing the same affordability issues as neighboring New York, the state is short nearly 140,000 units, according to Growing Together Connecticut, a grassroots organization advocating for new housing initiatives across the state. This problem could grow far more acute, particularly considering the large cohort of renters migrating to the state from New York City.
A first-quarter multifamily outlook from Marcus & Millichap for the New Haven metro suggests that rents could slow to 2.2% for the calendar year, but rapid growth in 2021 pushed average rents above $2,000 for the first time in the market’s history. Although a strong pipeline with expected deliveries of some 2,200 units may help to ameliorate further rent increases in the long term, most projects — as in other markets — are upscale developments catering to luxury renters.