New Jersey Apartment Loans and Multifamily Financing $1,000,000+

New Jersey Apartment Loan Rates - Rates updated February 17th, 2020

Multifamily Loan Product Rates (start as low as) LTV Amortization
5 Year Fixed 3.52% Up to 80% Up to 30 years
7 Year Fixed 3.68% Up to 80% Up to 30 years
10 Year Fixed 3.84% Up to 80% Up to 30 years

Select Commercial has excellent apartment building loan and multifamily loan products and options available for owners and purchasers of multi-family and apartment properties throughout the state of New Jersey. Whether you are looking to finance a small apartment building, a complex with hundreds of units, or a co-operative, we can help you find the optimal financing solution to meet your apartment mortgage loan needs. While we lend across the entire continental US, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. New Jersey is one of the states that we consider to be a premium market for apartment building loans and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified NJ borrowers looking to purchase or refinance an apartment property. We offer apartment loans with terms and amortizations up to 30 years, recourse and non-recourse, and many options for prepayment. We typically approve apartment building loans within 1 day and usually close within 45 days of application. Our clients love our simplified application process, 24-hour pre-approvals with no-cost and no-obligation, great rates and terms, fast closings and personalized service.

New Jersey Apartment Loan Benefits

New Jersey Apartment loan rates start as low as 3.52% (as of February 17th, 2020)
• No upfront application or processing fees 
• Simplified application process 
• Up to 80% LTV on apartment financing 
• Terms and amortizations up to 30 years 
• Loans for purchase and refinance, including cash-out 
• 24 hour written pre-approvals with no cost and no obligation

New Jersey Apartment Loan Types We Serve

If you are looking to purchase or refinance a New Jersey apartment building, don't hesitate to contact us. We arrange financing in the state of New Jersey for the following:

  • Large urban high-rise apartment buildings
  • Suburban garden apartment complexes
  • Small apartment buildings containing 5+ units
  • Underlying cooperative apartment building loans
  • Portfolios of small apartment properties and/or single-family rental properties
  • Other multi-family and mixed-use properties

Multifamily Loan Outlook - 2020

Across the country, experts predict that the multifamily market should continue with its strong performance into 2020. There are several crucial factors that support this favorable prediction, a few of which are delineated below. While there are also a variety of political and financial conditions present that combine to add a level of uncertainty to the market, the positives are anticipated to outweigh the negatives for investors in the multifamily sector in 2020. Firstly, healthy and viable labor markets are expected to continue to drive the demand for multifamily housing. Continued growth in employment rates is expected to fuel new multifamily household creation. In 2019, employers were on pace to create over 2 million net new jobs, making it the ninth straight year where employment growth came in at or above 2 million jobs. Secondly, apartment rents have been rising incredibly fast over the past several years. Late in 2019, California passed rent control legislation. However, as the law allows for annual rent increases of about five percent, rent is still expected to increase significantly. Some of the realities driving rents higher in top markets include increases demand for multifamily housing, rising land and construction costs and an influx of higher-end, luxury projects coming to the market. With these conditions in place, landlords are going to find themselves making more in rental income in 2020.

Experts further predict that buying and developing in the suburbs will remain the best bet for multifamily investors in 2020. They expect suburban multifamily growth to outperform urban as it maintains lower vacancy rates and achieves higher rent growth. According to CBRE Research, the top four markets for multifamily performance in the coming year are Phoenix, Atlanta, Austin and Boston. These four metros are very high-growth cities when considering metrics such as multifamily demand, population and employment. Additionally, construction and development are very active in these markets. Smaller metros and cities should also maintain prominence in the considerations of investors and developers. While the risk of overbuilding may be higher in smaller markets, there are several markets that appear to be primed for exceptional multifamily performance. Many smaller metros are undergoing a significant development of their urban centers, thereby improving quality of life and helping them to retain their employment base. Of these smaller markets, seven metros had 4% or higher rent growth as of the third quarter of 2019 and are incredibly likely candidates for outperformance in 2020: Albuquerque, Birmingham, Colorado Springs, Dayton, Greensboro, Memphis, and Tucson.

New Jersey Apartment Loan Options

Our company has multiple capital sources for these apartment loans, including: Fannie Mae, Freddie Mac, FHA, national banks, regional and local banks, insurance companies, Wall Street conduit lenders, credit unions and private lenders.

New Jersey Apartment Financing with Fannie Mae (FNMA)

Fannie Mae’s multifamily loan platform is one the leading sources of capital for apartment building loans in the US. Fannie Mae is a leader in the secondary market – meaning they purchase qualifying apartment loans from leading lenders who originate these loans for their borrowers. Fannie Mae purchases loans secured by conventional apartments, affordable housing properties, underlying cooperative apartment loans, senior housing, student housing, manufactured housing communities and mobile home parks on a nationwide basis. The Fannie Mae platform has many benefits, including:

  • Long term fixed rates and amortizations. Fannie Mae allows terms and amortizations of up to 30 years. Most banks offer only 5 or 10 year fixed rates and 25 year amortizations.
  • Non-recourse options. Most banks will require the borrower to sign personally for the loan. Fannie Mae offers non-recourse loans.
  • Lending in smaller markets. Many national lenders do not like to lend in rural or tertiary markets. Fannie Mae is a good option for these loans.
  • Assumability and Supplemental Financing. Fannie Mae allows their loans to be assumed by a qualified borrower. They also have a program which allows borrowers the ability to come back and borrow additional funds during the life of the loan (subordinate financing).

New Jersey Apartment Mortgages with Freddie Mac (FHLMC)

Freddie Mac is another government agency that provides mortgage capital in the secondary market for apartment building loans. Together, Fannie Mae and Freddie Mac control a very large portion of the multifamily market. Freddie Mac has a very aggressive program for small balance loans (from $1,000,000 to $7,500,000). Some features of this program include:

  • Market size driven. Freddie Mac classifies loans by the size of the overall market: Top, Standard, Small, and Very Small. Rates are best in top market locations (major metropolitan areas).
  • Capped costs. Freddie Mac lenders often cap the closing costs at a fixed dollar amount, thereby lowering the overall cost to borrow money.
  • Flexible pre-pay penalties. Freddie Mac offers many options for pre-payment penalties, from yield maintenance to step-down to “soft” step-down.
  • Interest-Only (I/O) loans. Freddie Mac will allow payments consisting of only interest and no amortization of principal.
  • Fixed rate terms. Freddie Mac offers fixed rates of 5, 7, and 10 years, followed by an adjustable period. These loans are called Hybrid/Adjustables. Loans have a 20 year term and a 30 year amortization schedule.

New Jersey Apartment Lending with Banks and Other Programs

While the agencies (Fannie Mae and Freddie Mac) offer some excellent programs, not every apartment loan applicant qualifies for these programs. We have many excellent choices for these loans with our correspondent banks, credit unions, insurance companies and private lenders. Some examples of these loans include:

  • Loans that require flexible underwriting or those that don’t meet standardized criteria.
  • Properties in less than desirable markets, or those that require repairs or updating.
  • Properties that don’t cash flow according to industry guidelines or lack stabilized cash flow.
  • Borrowers with past credit issues, including foreclosures, short sales, or judgements.
  • Borrowers who are not US citizens.

Whether you are purchasing or refinancing, we have the right solutions available for your multifamily mortgage loans. We will entertain loan requests of all sizes, beginning at $1,000,000. Click here to get started with a free loan quote.

New Jersey Multifamily Loan Information and Economic Overview

Commercial real estate investors looking for good opportunity would do well to look at commercial mortgage financing in New Jersey. Due to job growth over the past year, the U.S. economy continued to expand over the last year leading to highest wage increase year-over-year in the last decade. Construction and manufacturing jobs grew by 37 and 12 percent, respectively. At the same time consumer spending also improved. New Jersey’s economic growth was no exception. All of this spending accompanied by huge e-commerce growth has enabled the New Jersey commercial real estate market to once again profit from consumer demand. New Jersey’s industrial real estate market finished last year with a very strong fourth quarter highlighted by 6.5 million square feet of leasing transactions, and over four million square feet of net absorption (driving annual net absorption to 11.6 million square feet). Furthermore, the total available space went down from about 57 million square feet to just over 54 million square feet.  The overall vacancy rate dropped 20 bps year-over-year to about 3.3 percent.

New Jersey can also be a great place to obtain commercial mortgage financing in order to invest in multifamily buildings. Knowing exactly where to buy real estate is crucial when investing in the New Jersey multifamily market. One fact that may scare potential commercial real estate investors away is that New Jersey has the highest property taxes of any state in America. However, this frightening statistic also makes New Jersey a high potential investment location. High property taxes should cause personal property ownership rates to decrease. As a result, commercial real estate investors can purchase multifamily homes and apartment buildings cheaply and find a plethora of tenants who will reliably rent for years to come. The average rent for multifamily units in New Jersey’s large cities is typically lower than the national average. The fastest growing rents in the state over the past year were in Trenton where rental prices increased by 5.3%. Apartments in Hamilton saw the second highest annual rent increase, jumping by 4.4%, just under $60 more expensive than last year’s rent prices. The most expensive apartments in the state are located in Hoboken, with an average rent of over $3,470. Coming in at number two are units in Edgewater at an average rent of over $3,160, followed by Jersey City, with an average rent of about $2,920 per month. On the other hand, the lowest priced large city to rent an apartment in is Trenton, where the average apartment rent is $1,122. New Jersey’s smaller cities have followed the national trend by showcasing the fastest rent increases in their state. Orange City has maintained a year-over-year rent growth of 6.8%, while Blackwood apartments are 6.2% more expensive to rent than a year ago. In terms of commercial mortgages, there are over 675 thousand mortgages for commercial real estate properties throughout the state of New Jersey. The average value of these commercial mortgages is over $7.2 million, 32% above the United States average. This data indicates that New Jersey is a great place to take out a commercial mortgage loan.

As previously mentioned, the past year has seen trends heavily favoring industrial and multifamily real estate in New Jersey. Below are some of the biggest developments of the year in New Jersey commercial real estate. About a year ago, 109 Holdings LLC sold the building at 1200 Clinton St. in Hoboken to 1200 Clinton Equity LLC for $87.5 million. In September of 2017 it was reported that 109 Holdings LLC was developing the property, which was already mostly occupied at the time. In 2016, a joint venture of Fields Development Group and Ursa Development Group opened up leasing at 1200 Clinton St. The six-story 159-unit building sat on the site of a former coal burning plant that was decontaminated in 2013. This past January, Equity Residential purchased the development at 198 Van Vorst St. This 131-unit building was finished back in 2013 and as of December of last year it was 92% leased. While Equity Residential did not disclose the price at which it acquired the property, Reonomy data, based on public records, lists the sale price at over $77 million. The priciest acquisition by far in the New Jersey market in the past year came from the hottest asset class in the strongest submarket in the state. On April 1, Roseland Residential Trust, a subsidiary of Mack-Cali Realty purchased the 377-unit Soho Lofts from AEW for over $263 million. This multi-tower building was completed in 2018 and is located right next to the entrance to the Holland Tunnel.

New Jersey Apartment Loans

Select Commercial provides apartment loans and multifamily loans throughout the state of New Jersey including but not limited to the areas below.

• Atlantic County • Essex County • Ocean County • Bayonne • Gloucester • Old Bridge • Bergen County • Gloucester County • Passaic • Brick • Hamilton • Passaic County • Burlington County • Hudson County • Paterson • Camden • Hunterdon County • Salem County • Camden County • Jersey City • Somerset County • Cape May County • Lakewood • Sussex County • Cherry Hill • Mercer County • Toms River • Clifton • Middlesex County • Union City • Cumberland County • Middletown • Warren County • East Orange • Monmouth County • Woodbridge • Edison • Morris County • Elizabeth • Union County Newark