This property is located in Oakland. The property is commercial mixed use, with 2500 sqft of commercial space downstairs and 2500 of residential space upstairs (2 units, 3 bed/2 bath each unit). This particular property was in need of major rehab inside. In many places the interior was down to the studs.
Our borrower has extensive experience rehabbing properties, and had the funds available to complete the rehab himself. The loan request was for 65% of the purchase price, and we were able to secure a five year term for 11.49% on this property for our client. Due to the location and the condition of the property, this would have been a difficult transaction for traditional funding sources to fund. We were able to put together a hard money commercial loan for this Oakland property that met the needs of our client while at the same time being secure for the end investor.
With the track record of our client on past rehab transactions, the investor was secure in knowing that the property would be improved and his security through equity in the property would increase. With a five year term, our client is secure in knowing that he has time to completely rehab the property and get it leased out so that it will start cash flowing. This was a win-win transaction for our client and the end investor.