After already closing over $530 million of HUD loans in Louisiana, Sims Mortgage Funding is returning to the state to refinance Metairie Manor, nearly a decade after previously refinancing the property. Metairie Manor is a 287-unit, Section 8 funded, affordable senior housing community, owned and managed by affiliates of the Archdiocese of New Orleans. This represents the 11th refinancing Sims has closed for the Archdiocese and its management affiliate, Christopher Homes, Inc.
Sims previously helped refinance Metairie in 2012 when it paid off its HUD Section 202 Direct Loan. That refinancing produced about $250,000 in annual debt service savings that have been used to fund various services for residents in the community. As interest rates for HUD loans have dropped since then, ownership believed they could obtain even more debt service savings.
So, Sims arranged a new $10.8 million loan, which increased the borrower’s capital reserves without increasing the existing Section 8 funding. Sims also built approximately $700,000 into the new loan to supplement the existing reserve fund. Ultimately, the loan reduced the community’s interest rate by 33% and produced debt service savings of $118,000 annually. The borrower also obtained a 10-year extension of the loan term.
