Rate: 4.95% Fixed
Term: 10 Years
Amortization: 30 Years
DCR: 1.25
Recourse

Transaction Description: George Smith Partners placed the cash-out 10-year permanent loan for a 3 asset multifamily Houston, Texas portfolio. The properties were built in the 1950’s to supply military housing for returning WWII veterans. All three properties were rehabbed in 2013 to remain well-maintained Class C properties. Fixed at 4.95% for 10 years, the recourse loan was sized to a 1.25 debt coverage ratio on a 30 year amortization schedule.

Challenge: Capital providers are always concerned about providing a return of equity for Class C assets. Markets known for oil production facing the possibility of higher unemployment are problematic.

Solution: Detailed underwriting of both the assets and sponsorship group solidified the stability of the cash flow and the Sponsors’ capacity to address down cycles. Oil has been underperforming for several months yet there has not been any change in rental collections. The personal repayment guarantee added further credibility to the underwriting package.

Rate: 4.11% Fixed for Five Years
Term: 20 Years
Amortization: One Year Interest Only; 30 Years Thereafter
Non-Recourse
LTV: 60%

Transaction Description: George Smith Partners placed a bridge/rehabilitation take-out loan 18 months after placing the initial acquisition debt. Our Sponsor was able to recapture a portion of their cash equity due to the significant improvements in the physical plant and operations. The subject property underwent heavy renovations and had just reached re-stabilization at the time of the perm-loan funding; underwritten from just three months of operating history. Fixed at 4.11% for the first five years, the 20 year loan term offers one year of interest only and will float at 2.75% over the 6 month LIBOR for the remaining 15 years.

Advisors

Steve Bram Managing Director & Principal / GSP Co-Founder

David R. Pascale, Jr. Senior Vice President

Rate: LIBOR + 240
Term: 7 Years
Amortization: 30 Years
LTV: 55%
Non Recourse
Prepayment: 1 Year Lockout, 1% Thereafter

Transaction Description: George Smith Partners placed the cash-out refinance of a 256 Unit Apartment Community initially purchased out of foreclosure.  Sized to 55% of current value, the non-recourse loan is variable for 7 years at 30 Day LIBOR + 240 without a floor.  Our Sponsors’ all-in rate is 2.83% today.  With the 30 year amortization schedule, the current mortgage constant is 4.95%; equivalent to most all-in coupons in today’s debt market.  Prepayment is 1% of the loan balance after the 1^st year lock-out.  This loan also offers a float to fixed conversion option years two through five where the rate can be fixed at the Sponsors’ discretion.  Despite a large capital improvement need due to the asset age and former ineffective management, there are no lender impounds or capital reserves.