Rate: LIBOR + 9.25%
Term: 12-months plus one 6-Mth option
Amortization: Interest only
Loan to Purchase Price: 79%
Prepayment: Six-month yield maintenance
Transaction Description: GSP arranged the $10,700,000 non-recourse first mortgage for the acquisition of a 33,600 square foot land parcel located in Hollywood, California. The parcel is currently improved with 21,425 square feet of retail and office space; 18% of the space held vacant by the seller with the remaining tenants on short-term leases. An interest reserve was funded as in-place cash flow is inadequate to cover debt service. Cash flow will further decrease post-closing as the Sponsor vacates existing tenants in order to demolish existing improvements and build a 38,000 square foot grocery store. GSP was able to source a lender comfortable with the high loan per square foot due to tight market vacancy and in-place tenants paying significantly below market rate rents. Sized to 79% of purchase price, the two-week quick close acquisition loan priced at 9.25% over 30-Day LIBOR for the 12-month loan duration.
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