CRE Bridge Loan for a 22-Unit Motel in Fort Myers, Florida

Funded by Sherpa Capital Group

$800,000

Deal Details

Private Loan Type

Purchase

Approx. Funding Date

05/23/2024

Property Type
Hotel
Motel
Property City

Fort Myers

Property State

FL

Loan Term (months)

12

Lien Type

1st Mortgage

Payment Type

Interest Only

Purchase Price

$1,050,000

Loan-to-Purchase Price

67%

Borrower's Contribution to Purchase

33%

Source of Borrower's Contribution

Cash

Renovation Budget

$500,000

Renovation Budget Funded

20%

Borrower's Contribution to Budget

80%

After-Repair Value

$2,500,000

Renovation Project Scope

Heavy Rehab

Location Type

Urban

Property Condition

Fair

Occupancy at Closing

Vacant

Number of Units

22

Borrower's Plan

Renovate Vacant Units

Exit Strategy

Refinance

Borrower Credit Rating

Good

Interest Rate

15%

Broker Commission

$16,000

Deal Highlights

CRE Bridge Loan, Fort Myers, Florida - Motel Acquisition and Rehab Loan.
Term Sheet to close within 10 days including Site Visit.
Sponsor under tight deadline to close as another lender backed out of the deal.

Deal Summary

Sherpa Capital Group LLC, a private CRE lender, funded an $800,000 1st lien position bridge loan for the acquisition of a 22-unit motel/hotel in Fort Myers, FL. We funded 67% of the $1,050,000 purchase price plus 20% of the $500,000 renovation budget. The Borrower contributed 33% cash to the purchase and 80% of the renovation at closing. The after-repair value was estimated at $2,500,000 so our loan-to-value will be 32% of the ARV. The Borrower had good credit and was an experienced local real estate sponsor and investor in the residential and fix-and-flip market. They needed to close quickly as the property was under contract and another lender could not close within the timeframe. We were able to complete diligence, conduct a site visit, and provide financing within 10 days. The Borrower’s exit strategy is to conduct a full update to the units and continue operating as a motel, focusing on short-term weekly and monthly rentals for workforce housing. There is a significant shortage of workforce housing in the For Myers market. Upon completion of the heavy rehab, they plan to refinance with a local lender or SBA bank within the 12-month loan term. The interest rate was 15% with interest-only payments, and the broker earned a $16,000 commission. This CRE value-add bridge loan was funded in May 2024. 

Funded By

Sherpa Capital Group

Entrepreneurial Private Lender for All Types of Commercial Properties

Dealmakers

Rahul Shah

Managing Principal