| Transactions of the Week |  | |  | | Transaction Description: | | $7,300,000 Discounted Payoff of a Mixed-Use Office and Retail Building in Claremont, California George Smith Partners successfully placed the refinance of a discounted payoff (DPO) on a mixed-use, office & retail asset in Claremont, California. The subject property is listed on the Historical Landmark Registry. The new loan financed 97.3% of the total DPO amount on a non-recourse basis for a 3 year term. |
Challenge: The Sponsor did not have formal approval of the DPO terms from the existing lender until after appraisal receipt, and needed to close within weeks thereafter. While going through the DPO process, one tenant vacated the building. |
Solution: George Smith Partners worked with the new Lender to secure full approval and commitment prior to the formal DPO agreement. GSP was able to demonstrate that there was significant value in the property beyond what the existing Lender allowed. After the unexpected tenant vacancy, the new capital provider held terms by decreasing reserves and allowing for a lower debt service coverage ratio. | | | | |  | | Transaction Description: | | $1,200,000 Cash-Out Refinance of a Tertiary Multifamily Building Shahin Yazdi successfully placed a 75% LTV cash-out refinance for a 25-unit Texas apartment building. The subject property was constructed in 1991, and is located in a central Texas tertiary market. The loan is fixed for 10 Years at 5.65%. |
Challenge: The sponsor was an out-of-state borrower who did not own any other multifamily properties in Texas. The property was also highly leveraged, and the borrower required cash-out, necessitating an LTV of at least 75%. Lenders who would traditionally finance similar buildings were not comfortable with this location at the required leverage. |
Solution: GSP highlighted the experience of the management company and their portfolio of properties to make the lender comfortable with the stabilized operations and cash flow. Through our extensive capital relationships, we identified an institutional yet non-traditional lender active in this tertiary market. The new Capital Provider gave credit to the extensive list of the Capital Improvements the Borrower had made to the subject property, allowing the Lender to fund beyond their pre-determined LTV constraints. | | | Rate: 5.65% | | Term: 10 Years | | Amort: 30 Years | | LTV: 75% | | DCR: 1.25 | | Recourse | | Broker: Shahin Yazdi | | | |  | | | | National Investor Program for Single Tenant Assets George Smith Partners is working with a National Institutional Capital Provider lending on single tenant assets for owner/users or investors on a non-SBA platform. Public companies rated BB (S&P) or better will be underwritten with amortization schedules co-terminus with the lease. Private or unrated companies will be rated by the credit officer upon presentation of corporate financials. Rates are fixed for three years at 6% then re-set based on the credit quality of the tenant. Cash flow sweeps may be structured to provide additional funds at close to break below the standard 1.20 debt coverage requirement for this non-recourse loan. | | | | Hot Money | Northern California Bank with Life Company Pricing from $1,000,000 George Smith Partners is currently closing stabilized debt requests in Northern California with a regional bank local to that market. Ground-up construction requests are also being underwritten at this time. The capital source's conservative credit culture allows them to price aggressively, often undercutting more arduous Life Company applications. Ten-year transactions to 60% LTV sized from $1,000,000 to $25,000,000 are priced from 4.35% - 5.00% fixed, and offer stepped-down prepayment. Their geographic lending market consists of The Bay Area north to the Oregon Border. Non-recourse financing is available to higher quality assets. | | | 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 | |
No comments:
Post a Comment