D2 Capital Advisors arranges $37.3M in construction financing for 2507 Almond St.

A multifamily development in Philadelphia’s Olde Richmond Neighborhood

PHILADELPHIA, PA — D2 Capital Advisors (D2CA) announced the arrangement and closing of a $37 million construction financing package for 2507 Almond St., a 155-unit, six-story multifamily development in the Olde Richmond neighborhood of Philadelphia. The capital stack comprises a $20 million senior construction loan and $17.3 million in Commercial Property Assessed Clean Energy (C-PACE) financing. D2CA arranged both tranches on behalf of Riverwards Group (“Sponsor”), led by principals Mo Rushdy and Larry McKnight, P.E., LEED-GA.

The senior construction loan was provided by Silver Heights Capital and the C-PACE financing was from Nuveen Green Capital (NGC). Together, the two tranches fund construction of the 104,469 s/f project, which will deliver a unit mix of 119 studios, 24 one-bedrooms, and 12 two-bedrooms, along with 63 parking spaces, a rooftop deck with skyline and river views, a green roof, and bike parking. The project has secured a fully approved 10-year, sliding-scale tax abatement and is being built by Urban Renewal Builders, Riverwards Group’s affiliate general contractor. Both the senior loan and the C-PACE financing were structured on a non-recourse basis.

The transaction was led by Jack Cortese and David Frankel of D2 Capital Advisors, who structured and arranged the layered senior debt and C-PACE financing to maximize proceeds and minimize the Sponsor’s overall cost of capital.

“The headline narrative on Philadelphia multifamily has been oversupply and slow absorption, and on the surface that made this a harder financing to tell,” said Cortese. “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. Getting lenders to underwrite to that reality, rather than the headlines, is what allowed us to finance 2507 Almond Street on terms that work for Riverwards Group.”

“We hired D2 Capital Advisors with a clear mandate: secure non-recourse construction financing and help us build lending relationships beyond the strong local bank relationships we’ve relied on for years,” said Mo Rushdy, principal of Riverwards Group. “Jack and the D2 team delivered on both fronts, sourcing this financing through their debt fund execution and giving us a new institutional capital relationship to further fuel our development pipeline.”

“We were proud to partner with D2 Capital Advisors to provide C-PACE financing, administered through Philadelphia Energy Authority, for this exciting new multifamily property in Philadelphia,” said Mike Doty, Senior Director of Originations, Nuveen Green Capital. “Through C-PACE, Riverwards Group was able to access a significant non-recourse capital layer at a competitive fixed rate, reducing their overall cost of capital and helping make the project financially viable while delivering much-needed housing to this growing area of the city. This transaction underscores how C-PACE, as a flexible and cost-effective financing platform, can be a crucial part of a capital stack, and can positively impact construction financing by bridging the gap between senior debt and equity.”