Apollo real estate lending approaches $425 million YTD

Apollo Commercial Real Estate Finance (ARI) has closed two commercial real estate loans in New York City totaling $95.5m and, through a repurchase agreement with JPMorgan Chase Bank, has increased its borrowing capacity by $200m to $800m, reports PDI sister publication Real Estate Capital.

ARI's year-to-date transaction volume stands at $423.5 million of committed capital, according to a statement announcing the new loans.  

The bulk of that business was done in Q1. After a strong start to the year, ARI's Q1 debt investments consisted of $251 million in first mortgage loans, as well as $77 million in subordinate loans, as previously reported.

ARI specializes on floating-rate first mortgage debt on transitional properties. The firm noted that the latest transactions are with “well-capitalized sponsors who intend to improve the current use of the underlying properties, one of which is a repeat borrower.”

The largest of the two is a $50 million first mortgage loan secured by two midtown Manhattan office buildings with ground floor retail. The floating rate loan has a two-year initial term with one six-month extension option and an appraised loan-to-value of approximately 52 percent. The loan has been underwritten to generate a levered internal rate of return (IRR) of approximately 14 percent.

The second is a $45.5 million first mortgage loan secured by five residential and commercial properties with ground floor retail in the Williamsburg section of Brooklyn, New York.  The floating rate loan has a two-year initial term and an appraised LTV of approximately 53 percent. That loan has been underwritten to generate a levered IRR of approximately 17 percent.

In connection with the JPMorgan Facility, the company has received approximately $115 million for a first mortgage loan secured by an assemblage of properties in the Design District of Miami, which does not count toward the $800 million facility's capacity.