Market Overview

RED Capital Group Arranges $7.8 Million Construction Loan to Convert Historic Building to Apartments in Lancaster County, PA

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RED
Capital Group, LLC (RED)
recently arranged a $7.8 million
construction loan for Tobacco Road apartments, an adaptive reuse of an
historic building in Landisville (Lancaster County), Pennsylvania. Total
project cost is $9.6 million.

This press release features multimedia. View the full release here:
https://www.businesswire.com/news/home/20181011005893/en/

This former tobacco warehouse will be converted into a 66-unit apartment community. (Photo: Business ...

This former tobacco warehouse will be converted into a 66-unit apartment community. (Photo: Business Wire)

The loan will be used to develop the currently vacant brick warehouse
into a 66-unit apartment community. The structure, a former tobacco
warehouse consisting of four connected buildings, was built in the early
1900s and is on the National Register of Historic Places. The
redevelopment will take advantage of some of the historic features,
including refinishing wood floors in certain areas and exposed wood
beams.

The apartments will help fulfill a substantial need in the region for
market-rate units. They will be developed by S. B. Conrad. The complex
will include one-, two- and three-bedroom units, an elevator, lounge
area and fitness center, among other amenities.

"We identified this project as a regional opportunity," said David
Bonomo, Director at RED. "We directed our efforts toward local community
lenders, and we are very pleased with the results."

"This is an exciting opportunity," said Steve Conrad, President of S. B.
Conrad. "Tobacco Road will provide high-quality rental apartments in the
Lancaster area marketplace, where the demand far exceeds the supply. To
do so while preserving such a meaningful local real estate asset makes
it even more rewarding."

RED acted as exclusive structuring agent, and managed the solicitation
effort on behalf of S. B. Conrad. They negotiated favorable pre-payment
provisions, which will allow Conrad to refinance the bank loan within
two years with no prepayment penalty.

"The RED team made this happen for us," said Conrad. "They managed the
financial side of the equation, allowing us to focus on what we do best
– development. RED targeted the appropriate segment of construction
lenders, delivered a term sheet in a matter of days, and positioned us
to close within a few weeks."

"This effort demonstrates the full-service capabilities of RED's team,"
said Trent Brooks, President and Head of Production at RED Mortgage
Capital.

About RED CAPITAL GROUP, LLC

Recognized for its industry expertise, innovative and comprehensive
structures, and consistently high rankings, RED Capital Group, LLC has
provided over $78 billion of integrated debt and equity capital since
1990 to the seniors housing and health care, multifamily, affordable,
and student housing industries through three operating companies.

RED Mortgage Capital, LLC is a Fannie Mae DUS® and MAP- and
Lean-approved FHA lender with a mortgage servicing portfolio over $17
billion. RED Capital Markets, LLC (MEMBER FINRA/SIPC) is active in the
distribution of Fannie Mae and Ginnie Mae Project MBS, and provides
structuring, underwriting, placement, and advisory services for
tax-exempt and taxable housing and health care bonds.

RED Capital Partners, LLC provides proprietary debt and equity
solutions, and asset management in a range of forms, including
subordinated gap and bridge loans. RED Capital Group, LLC is a
subsidiary of ORIX Corporation USA. For more information on RED Capital
Group, LLC, visit our website at: http://www.redcapitalgroup.com.

DUS® is a registered trademark of Fannie Mae.

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