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223 Willow Residences

223 Willow Residences

$34,537,000 Construction-Completion Financing

Fort Collins, CO | February 2022

Thorofare Capital provided a $34,537,000 construction-completion senior loan for the development of 223 Willow Residences, a 197-unit, two-building apartment project in the center of Downtown Fort Collins, Colorado.

The senior financing closed in tandem with a mezzanine loan from a third-party capital provider, which closed simultaneously after an inter-creditor agreement.

223 Willow Apartments is located directly to the east of Downtown Fort Collins and north of the Old Town neighborhood. The subject is near multiple restaurants, bars, coffee shops, and retail stores resulting in a walk score of 71 and bike score of 100. In addition, the property is approximately 1.25 miles north of Colorado State University. The subject will be comprised of two, five-story buildings on a 2.04-acre site.

The luxury property will feature of mix of studios, 1 bedroom, and 2-bedroom units averaging 581 square feet. Unit finishes will include vinyl plank flooring, solid surface quartz counters, wood cabinets, and stainless appliances. All units will have in-unit laundry and air conditioning.

In addition to the residential units, there will be 158 garage parking spaces. Amenities will include secured access, bike storage with a bike repair station, parcel lockers, community outdoor deck, and a community clubroom.

The main demand drivers for the county residents in Fort Collins due to jobs stemming from Colorado State University, tech companies, and the craft beer industry. CSU has drawn high quality employers to the area due to the constant supply of graduates from the University. Tech companies include Hewlett Packard, AMD, and Intel.

Vacancy in the county has continually decreased, below 4%, due to minimal supply pressure and steady demand. Net absorption has remained positive, even through COVID-19. The strong demand has pushed average asking rents up 12.7% over the last year, at the time of loan origination.

The interest-only, highly structured construction-completion loan carries an initial term of two years, in addition to one extension options, and fully capitalizes the project’s development budget through its lease-up upon commencement of operations.

The sponsor is a U.S.-based, global investment, development, and management company with 185+ assets owned and operated, totaling an estimated gross asset value of $13 billion.