| Transaction of the Week |  | |  | | Transaction Description: | | $16,000,000 Construction Financing for Big Box Retail Pad at sub-4% rate. GSP arranged the 65% of cost for land and "horizontal development" loan for a new big box single tenant retailer. The site is a 8.38 acre parcel adjacent to a 500,000 + s.f. retail center also owned by the client. The center (not part of our collateral) includes a 50,000 s.f. grocery store, movie theater, high end chain restaurants within a contemporary outdoor setting. The investment grade tenant has signed a 30 year ground lease with extensions and will be building their own store. The lease requires the Sponsor to deliver a construction ready "clean dry pad" to tenant for their building construction. Our Client demolished a functionally obsolete, freestanding 200,000 s.f. building that had been vacated by a failed retailer, then added utilities and raised the pad using pilings to create the proper foundation for the new store. The construction loan was uncovered at funding although the Borrower has since forward rate-locked a permanent take-out loan scheduled to close 2Q 2012. This was GSP's 11th financing for the client. | | | Rate: 30 Day LIBOR+3.75% (no floor) | | Term: 15 months | | Amort: Interest Only | | LTC: 65% | | Recourse: Full recourse, reduced to 25% upon pad completion Brokers: Steve Bram, David R. Pascale, Jr. | | | |  | | | | Net-Leased Single-Tenant Financing from $750,000 GSP is working with a Southern California based bank currently funding stabilized net-leased assets nationwide. Strong franchisees will be considered although pads leased to corporate operators located in anchored retail centers are preferred. Available financing ranges from $750,000 to $3,000,000. Pricing is fixed in the low 5s for the first 5 years, then rolls to a floating rate for the remaining 5 year term. Full recourse programs are available to 65% LTV, with non-recourse interest-only options to 50% LTV. Flexible prepayment penalty structures are available and non-traditional uses (self-storage) will be considered by exception. | | | | Hot Money | Life Company Debt from $1,000,000. GSP is working directly with a small Life Insurance Company currently funding permanent loans on stabilized assets from the Dakotas to Texas and West to the Pacific Coast. This capital source will finance the four primary product types from $1,000,000 to $6,000,000 for three, five or 10 year terms, amortized over 30 years. 75% acquisition financing is available, 70% for refinances, both limited by a 1.30 DCR. A step-down prepayment is available for three and five year terms. Ten year loans carry yield-maintenance pre-payment penalties. | | | If you have an inquiry regarding George Smith Partners' commercial real estate financing, please contact your GSP representative or Todd August, Chief Operating Officer, at (310) 867-2995 or TAugust@GSPartners.com. | | | Come Grow With Us! | George Smith Partners is expanding its team of top-notch mortgage brokers/originators. We offer highly competitive compensation and an excellent environment in which to work, learn and be supported. We invite you to consider a career with George Smith Partners. Please direct confidential inquiries to Todd August, Chief Operating Officer, at (310) 897-2995. | | | Pascale's Perspective | US Economy: Eyes on Congress and Fed: While Europe news has been dominating the headlines and market fluctuations, the US economy has shown promising signs for 2012. However, Congress is again front and center with another "midnight battle" on the payroll tax cut extension. No extension means less money in the pockets of the consumers who spend the highest percentage of their earnings on goods and services. Fed: yesterday's statement disappointed markets, but look for the Fed to start purchasing MBS again in January or February in order to push the economy. Europe: The markets have spoken—the latest plan is not good enough. Investors lack of confidence in the plan looks to leave two options: (1) Total integration with the ECB providing liquidity and buying the bonds of troubled countries (Italy, Spain, Greece) or (2) Total or partial Euro breakup with a return to different currencies. Germany, with its memories of Weimar hyperinflation of the early 1920's, is firmly standing in the way of option 1. This may set off a deflationary spiral with unintended consequences. ...stay tuned... David R. Pascale, Jr. | |
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