$5M Multifamily Refinance Denver | Commercial Lending Solutions 
Loan Size Example

$5 Million Multifamily Refinance in Denver

By Trevor Damyan, Commercial Mortgage Broker at Commercial Lending Solutions

A $5 million multifamily refinance in Denver represents the sweet spot for agency execution, where debt markets remain competitive and lender appetite is strong. These deals typically feature stabilized workforce housing or Class B garden-style apartments across Denver's maturing submarkets, with sponsors looking to optimize leverage, extend maturity, or pull equity for portfolio expansion. At current 10-year Treasury levels, permanent multifamily rates are pricing 5.75 to 5.95 percent depending on loan structure and borrower profile. Denver's steady rent growth and low-friction underwriting environment make this loan size attractive to both agency platforms and regional balance-sheet lenders.

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Capital Stack

What a $5M Multifamily Refinance Capital Stack Looks Like

At $5 million, the capital stack is dominated by agency small-balance and boutique multifamily platforms, which have designed underwriting workflows specifically for this size and can close in 45 to 60 days. Freddie Mac Optigo SBL and Fannie Mae DUS Small are the primary execution vehicles for this range, offering fixed-rate, 30-year amortization with minimal subordinate debt requirements. Lender selection typically hinges on DSCR, recourse appetite, and the borrower's interest in interest-only periods or rate locks.

Capital Source Rate / Cost Size / LTV Notes
Agency small-balance platform (Freddie Optigo SBL or Fannie DUS Small) 5.75 to 5.95 percent fixed $5M / 65 to 75 percent LTV 30-year amortization, full recourse, 1.25x minimum DSCR, no subordinate debt, fixed-rate locks available, 45 to 60 day close typical
Regional bank balance sheet 5.80 to 6.10 percent fixed or floating $5M / 70 to 80 percent LTV Faster timeline (30 to 45 days), more flexible underwriting, may accept lower DSCR, local relationships valued, recourse or limited recourse negotiable
Life company 6.00 to 6.25 percent fixed $5M / 55 to 65 percent LTV Longer hold periods (10 to 15 years), lower leverage but stronger capital stability, slower close (60 to 90 days), minimal recourse common, large cap preferred
Debt fund or alternative lender 6.25 to 6.75 percent, higher fees $5M / 60 to 70 percent LTV Faster approval for challenged sponsorships, higher leverage available, higher origination fees and servicing costs, 30 to 45 day close, short-term bridge to agency refi possible

Pricing reflects active CLS CRE quote pipeline as of April 2026. Specific deal pricing depends on sponsor, property, and structure.

Sponsor Profile

Who Closes a $5M Multifamily Refinance Deal

The typical $5 million multifamily refinance borrower in Denver is a mid-market operator with 10 to 20 years of experience and a portfolio of 200 to 800 units across the Front Range. Net worth ranges from $1 million to $5 million with strong liquidity; these sponsors often have W-2 income or are operating partners in larger funds. Motivations are usually tactical: rate optimization, balance-sheet restructuring, or capital release to fund acquisitions or value-add projects without selling core assets.

From the CLS CRE Pipeline

A Real $5M Example

CLS closed a $4.8 million refinance on a 96-unit Class B apartment community in the Highlands submarket in late 2024. The property exhibited 1.35x DSCR on $415K annual net operating income; we placed the loan with a regional bank at 5.82 percent fixed, 30-year amortization, 72 percent LTV, with full recourse and a 12-month interest-only period to match the sponsor's capital call schedule. The borrower gained an additional $1.1 million in liquidity and extended the maturity to 2054, enabling them to fund acquisition of a second asset in Westminster without portfolio dilution.

Anonymized. All deal references protect borrower and lender identity.

FAQ

$5M Multifamily Refinance Denver FAQ

Agency platforms typically require 1.20x to 1.30x DSCR, with 1.25x as the standard threshold. Regional banks may accept 1.15x to 1.20x depending on the sponsor's market position and recourse strength. Life companies, which hold longer, often target 1.35x or higher to cushion against interest-rate normalization or market slowdown.
Agency execution typically closes in 45 to 60 days from complete application; regional banks can move in 30 to 45 days if the sponsor and property are known. Subordinate lenders or non-agency products may add 10 to 30 days. The fastest track is a bridge-to-perm strategy with a debt fund or private lender closing in 20 to 30 days, then refinancing into agency within six to twelve months.
Yes; most agency platforms and regional banks offer 12 to 24 months of interest-only on refinance products, especially if DSCR is strong (above 1.30x). Life companies rarely offer IO periods but may negotiate a lower amortization schedule (40-year am) to reduce early debt service. IO periods are increasingly bundled with rate-lock or prepayment flexibility riders.
Agency platforms typically offer 30, 60, or 90-day rate locks at no cost; extending beyond 90 days costs 0.125 to 0.375 percent depending on market volatility. Most regional banks include a 30 to 45-day lock in the application; secondary market hedge costs apply if the lock is extended. Locking 15 to 30 days before close is standard practice to align funding with construction.
Agency platforms do not require subordinate debt or equity injection as long as the refinance LTV is 75 percent or lower. If the borrower wants to extract more cash (pushing LTV to 80 percent), a regional bank or life company can accommodate, but recourse language may tighten. A 5 to 10 percent equity holdback from the refinance proceeds is common for reserves or capital calls.


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