Developer Rod Mullice Lands Permanent Financing, Bond Money for $41 Million, Two-Phase Apartment Project
Rod Mullice’s gambit near Aerotropolis Atlanta is paying off and has the multifamily developer prepping his next project for take-off.
Mullice is managing partner of Air Realty, the developer of The Pad on Harvard, a two-phase, $41 million transit-oriented development located by the $500 million-plus Aerotropolis mixed-use development in College Park, GA, near Hartsfield-Jackson Atlanta International Airport. When Mullice, Romel Canete and partners Jerome Russell and Michael Russell of H.J. Russell kicked off Phase I of The Pad, a 109-unit apartment building, it was a gamble.
No new, upscale multifamily had been developed in College Park in four decades before Air Realty started The Pad in July 2015. The five-story, mid-rise delivered in early 2017 at 1777 Harvard Ave.
Mullice and Air Realty got the confirmation they needed, and a huge boost of confidence, this month when Germany’s biggest bank provided permanent financing for The Pad. Deutsche Bank delivered a $13 million permanent, interest-only loan for the development. “The realization of this vision has been a very gratifying experience,” Mullice said.
Air Realty will use the proceeds from the loan to complete a pool, expand the parking deck and distribute returns to investors.
Air Realty also recently approached the Development Authority of Fulton County, seeking the issuance of $14 million in revenue bonds to help refinance The Pad. On April 24, the DAFC board unanimously approved the final bond resolution for The Pad.
Mullice said his investors were more than pleased to receive returns so quickly. Moreover, the Deutsche Bank loan was secured with low leverage and a debt-to-equity ratio of about 64 percent. “I’m very, very conservative. I entered the business after a failure and learned that low-leverage allows you to live for another day,” Mullice told CoStar News.
Mullice, who previously focused on the brokerage business, said having the opportunity to work with and learn from the Russell brothers proved critical as he broke into development. The Russell’s run H.J. Russell & Co., one of the oldest and most-established development and contracting firms in Atlanta and one that often serves as the required minority partner in major developments such as Mercedes-Benz Stadium.
Jerome Russell, president of H.J. Russell, said landing a non-recourse loan with attractive terms speaks to the quality of The Pad from an institutional investor’s standpoint. “I believed in this vision from the very beginning,” he said.
Looking forward, the success of The Pad means two things for Mullice. First, he is close to securing a tract for The Pad II. Second, Air Realty just retained architect/planning firm Tunnell Spangler Walsh, or TSW, to design a new development with townhomes and a small-scale condo building.