| Transaction of the Week |  | |  | | Transaction Description: | | $5,775,000 Refinance of an Unanchored Retail Center in Santa Clarita, California. George Smith Partners successfully placed the refinance of a 100% occupied, unanchored strip retail center in Santa Clarita. The property's location outside of a core market presented a challenge, yet GSP was able to identify a lender comfortable with the building's secondary location. GSP underscored the retail center's strong positioning on a major retail intersection with high traffic counts. The center's strong national tenant mix and unique architecture drives significant foot traffic, enabling the center to outperform comparable properties. Although unanchored, GSP emphasized that 40% of the center's GLA is comprised of national tenants, and 45% of the existing tenant base has been in occupancy for over ten years. The fully leveraged non-recourse loan floats for two years interest only, priced at LIBOR + 3.35%, subject to a 4.0% LIBOR floor. | | | Rate: 1-Mo LIBOR + 335bps w/7.35% Floor | | Term: 2 Years with 3, 1-Year Extensions | | Amort: Interest Only | | LTV: 75% | | Non-recourse | | Brokers: Gary E. Mozer, Josh Roseman | | | |  | | | | Non-Recourse Faith-Based Lender. George Smith Partners is working with a National Bank currently funding construction, bridge/reposition and permanent loans to non-profit faith based organizations on a non-recourse basis. All faiths will be considered for ground-up, reposition or permanent funding of churches, temples, schools, hospitals/medical facilities that have a religion-affiliated use. Non-profit organization that can demonstrate a minimum of 250 giving units will be considered. The collateral does not need to be on the primary campus but must be faith-related. Loan limits range from $1,000,000 to $25,000,000. | | | | Hot Money | DPO Funding to 100% of Re-Stated Value George Smith Partners identified a fund currently advancing up to 100% of the re-stated value in a discounted pay-off (DPO) scenario for the existing borrower. Note acquisitions will require new cash equity to close. This capital provider is yield driven and not looking to "Loan to Own". Transactions must have a verifiable exit or obtainable business plan to take the capital provider out upon re-stabilization. Yield requirements will vary based on product type and hold criteria although once the required yield is obtained, the lender will not participate in upside equity. Borrowers are further incentivized to maximize their business plan without the splits of a new equity participant. | | | 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. | | | Speakers Corner | Managing Member Steve Bram will be a panelist at the annual "How High Is The Sky" conference on Thursday March 29th to be held in Century City. The morning symposium will review capital providers and lending terms, lender responces to problem loans, Westside Commercial outlook & trends and the Santa Monica spillover factor. For registration and more information please click here or call The Century City of Chamber of Commerce at (310) 553-2222. | | | Pascale's Perspective | Treasuries, Risk Spreads and Coupons…. Interrelated they are…… Borrowers and investors are concerned that the recent run up in Treasury yields is driving all-in loan rates upward. Several lenders have indicated they are "holding the line" on coupons as risk premiums are compressing as the index rises. Fannie and Freddie: Recent rate locks have been "very close" to last week's rate (example: A loan locked at only 5 bps over last week even though Treasury had jumped 30 bps during that same period. CMBS: Lenders are tightening to win business as AAA spreads and profit expectations tighten as originators want volume. Life Companies and Banks: A quick survey found many "holding the line" on coupons. Note that CMBS, Fannie, or Freddie bond buyers all in yield expectations did not change much as the "risk trade" continues. Obviously a further run up in the Treasury index will eventually see coupons rise. ...Stay Tuned... David R. Pascale, Jr. | |
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