A $37M construction loan will help bring more new apartments to a Philadelphia multifamily submarket that has experienced a development surge.
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Riverwards Group is borrowing the money to build 155 units at 2507 Almond St. in the Olde Richmond neighborhood. The financing deal includes a $20M nonrecourse senior loan from Silver Heights Capital and $17.3M of commercial property assessed clean energy funding originated by Nuveen Green Capital.
The loans were coordinated by a D2 Capital Advisors team including Vice President of Capital Markets Jack Cortese and Chief Operating Officer David Frankel.
“The headline narrative on Philadelphia multifamily has been oversupply and slow absorption, and on the surface that made this a harder financing to tell,” Cortese said in a statement.
“But our own proprietary data and local market knowledge told a different story: leasing velocity in the Northern Liberties/Fishtown/Olde Richmond corridor was picking up significantly, while new construction starts had pulled back sharply, with very little new competitive supply underway or even planned.”
CBRE found that the Northeast Philadelphia submarket, which includes the Riverwards project, had 1,781 multifamily units completed over the 12 months ending in March.
The submarket recorded 4% year-over-year rent growth in the first quarter, the second highest in the region behind only Chester County.
The submarket’s 4.3% vacancy rate was also the lowest in Philadelphia proper, compared to Center City’s 5.9%. But vacancy in the Northeast Philly submarket still surpassed the 4% seen regionwide.
Riverwards' project is planned to include 119 studios, 24 one-bedrooms and 12 two-bedrooms alongside 63 parking spaces and a rooftop deck. It is expected to deliver in 2028. The developer also received a 10-year sliding-scale tax abatement for the building.
Founded in 2009, Riverwards has built about 1,500 residential units in Philadelphia. In March, the company sold a newly constructed 200-unit building at 1635 N. Fifth St. to the Philadelphia Housing Authority for $49.1M.
