Success Story
Fidelis Private Fund was approached to fund the acquisition and conversion of an aging 3-story hotel into a single-room occupancy (SRO) housing project in the heart of downtown San Diego. The borrower faced the challenge of securing financing for a unique transitional housing redevelopment—one that required a lender able to move quickly and understand both the value and impact of the transformation. Traditional financing options were limited due to the building’s prior use and the borrower’s need to close within a tight timeline.
The Solution
Fidelis provided a $1,700,000 bridge loan secured by a 1st Trust Deed to acquire and begin conversion of the existing hotel property. While Fidelis typically avoids transitional hotel assets, this opportunity aligned with our values: solving complex borrower needs, participating in value-add housing opportunities, and supporting experienced developers. Appraisal at stabilized occupancy is $3,650,000, establishing a conservative 47% LTV—acceptable given the property’s prime location, clear redevelopment strategy, and strong borrower profile.
Exit Strategy
Once the conversion to 30 fully furnished SRO units is complete, the borrower plans to refinance with a conventional lender. The property is anticipated to generate stable income due to high demand for affordable housing downtown. The strong pro forma rent roll and low vacancy projections support this refinancing strategy.
Value Added
Fidelis recognized the broader community value of this project. With most construction risk mitigated and permits in place, this deal reflects our willingness to go beyond conventional “check-the-box” underwriting. We understood the asset’s potential, the borrower’s vision, and the pressing need for housing in the area—all while staying within prudent loan-to-value guidelines.
Another transaction where Fidelis Private Fund is helping our clients achieve their financial goals.