Red Oak Originates Loan to Refi Multifamily Property in Washington, D.C. Opportunity Zone

Red Oak Capital Holdings, a commercial real estate finance company and Regulation A+ sponsor, has originated an $8.5-million bridge loan to refinance and rehabilitate a low-rise multifamily property in Washington D.C.

The garden-style community, 8th Street NW Apartments, sits on a 0.34-acre site that has been designated as an opportunity zone. The borrower will use the funds to refinance nearly $6.5 million of existing debt and complete the restoration of the property.

“A growing number of investors are having a difficult time getting their business plans over the finish line, with the current state of the debt market, rising interest rates and the retreat of traditional capital sources from the field,” said Gary Bechtel, Red Oak’s chief executive officer. “When this property’s owner experienced delayed funding processes with another lender, he opted to come to us instead. The decision was a no-brainer on our end.”

The three-story community was originally built in 1927 with 38 studios and one-bedroom units. When completed next year, it will contain 41 three-bedroom, one-bath units averaging 750 square feet. The units will have new flooring, countertops, cabinets, lighting, an HVAC system, and stackable washer and dryers in each unit.

Ultimately, Red Oak says they will be leased to residents through the federally funded Housing Choice Voucher Program.

Red Oak Capital Holdings is a group of commercial real estate capital entities that lends and invests on commercial real estate, raising capital through retail and institutional channels. The firm has more than $400 million of assets under management and commitments from both retail and institutional investors.

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