Financing additional units on existing multi-family property

[Greg Clatterbuck]

I am looking for advice on financing construction and converting to long term financing.  The property is a recent purchase and currently cash flows.  Part of appeal for purchasing is that fact there are existing pad sites with water and sewer hookup in place.  As it sits, there are 7 townhouse style units with below market rent.  Rent was scheduled to increase April 1 until the pandemic, and has been delayed by several months.  The projected gross rental is $92,400 annually.  The current debt service including taxes/insurance is $60,600.  The current valuation is approximately $900k with $600k loan balance.  The cost of constructing an additional 7 units is between $1.3-1.4M and would generate a projected $118,000 annual rent for a total of $210,000.  The valuation would be approximately $2.5M.  The goal is to convert the debt to 30-35 year fixed using a federal loan program as this is a long term hold property.  An additional 4 units could be added as well in the future, but is not in the immediate plans.  What is the best way to achieve construction funding and how difficult is it to obtain Fannie Mae or Freddi Mac long term funding?  I have done several single families, but this is my first multi-family.