$53,900,000: $42.6MM “Non-Recourse” Construction + $11.3MM Preferred Equity Financing for 228-Unit Multifamily Development

Rate & Terms: Confidential

Transaction Description:
George Smith Partners secured a $42,600,000 non-recourse senior construction loan along with $11,300,000 preferred equity placement to develop a 228-unit Class A multifamily property in Orange County, CA.

Challenges:
The sponsorship required a non-recourse solution at an appropriate leverage to achieve the entire project’s capitalization during a time when many lenders were pulling back on construction financing in general and reducing leverage if able to lend at all.

Solution:
GSP utilized its significant experience and deep relationships with active capital providers to secure the non-recourse construction financing. GSP was also able to secure preferred equity in lieu of sponsorship bringing in additional equity which allowed the transaction to be appropriately capitalized for the developer to hit their pro forma return on equity.

Advisors

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