GSPartners
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Volume XVIII | No. 9 | March 5, 2010
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KEY RATE INDICES
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Prime Rate
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3.25%
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1 Month LIBOR
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0.23%
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5 Yr US Treasury
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2.28%
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5 Yr Swaps
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2.58%
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12-MAT
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0.44%
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3 Month LIBOR
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0.25%
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10 Yr US Treasury
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3.61%
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10 Yr Swaps
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3.69%
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11th Dist COFI
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1.83%
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6 Month LIBOR
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0.38%
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30 Yr US Treasury
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4.56%
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| Transaction of the Week |  |
|  | | Transaction Description: | | $5,655,000 Refinance of 80+ Unit Apartment Complex in San Fernando Valley at 5.31% History: GSP arranged acquisition financing through Fannie Mae for this 1960's vintage property in 2001. We arranged a Fannie 2nd a few years later.
Today: Our borrower chose to pay a slight prepayment penalty in order to secure a desirable "Tier 4" interest rate for the next 10 years. It also eliminated any underwriting risk if Fannie changed their parameters this year. The financing provided for approximately $1,000,000 in cash out and a lower monthly debt service payment. Property is over 95% occupied, 2 stories, garden style with swimming pool, sundeck, fitness room, etc. It offers a range of unit types including bachelor, studio, 1 br, 2br and 3 br. |
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|  | | Help Wanted | High volume loan originator is accepting resumes for new assistant/processor Duties would include processing lender applications, interfacing with third parties during closing process, and communication liaison with bank underwriters and clients.
Applicant must be competent in processing and closing procedures, experience working with high volume commercial loan transactions, and have the highest level of ethics and professional integrity. Desired previous work experience may include; bank processor or underwriter, or commercial loan broker processor/assistant. Please submit your cover letter and resume electronically to Todd August, COO George Smith Partners at taugust@gspartners.com.
Please put in the subject line “Processor Application”. Compensation will be based on previous work experience in the form of a hourly compensation with the opportunity to be paid bonuses on closed deals. George Smith Partners is an equal opportunity employer. | | | | Bridge Lender Providing Highly Leverage Debt for Large Upside Transactions This is "quasi-equity" for busted condos, discounted payoffs, and other "deal triage" situations. This is not programmatic lending, it is transaction specific. Recent transactions include a DPO on a hotel in a secondary market. Typical structure is up to 85% of cost, with lender getting a coupon and profit split to get to a 15+% IRR, or a 1.3-1.4 multiple. Transaction sizes are $10,000,000 to $30,000,000, terms 1-3 years. Secondary and tertiary markets OK. | | Transaction Size: $10,000,000-$30,000,000 | | Rate: 10% plus participation | | Loan Term: 1-3 years | | Max LTV: 85% | | Max LTC: 85% | | Non-recourse | | Geography: Nationwide |
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| | | Hot Money | Insitutional Equity: 2010 JV Program GSP recently met with an institution providing debt and equity nationwide. The equity program parameters are a good bellweather to understanding the "middle of the fairway" targets for 2010. This institution is looking for Joint Ventures, matching their funds with local developers. They are looking for "Market Recovery, Reposition, and/or Value Added" transactions with 3-7 year hold periods. They are looking to take advantage of the "new basis" post credit crisis. Typical structure is 35% Equity/65% Leverage; with the instituion providing 50 - 85% of the required equity. Preferred returns: 8-12%; Return Targets: Minimum 16% Leveraged 5 year IRR; Transaction Size: $10,000,000-$25,000,000 Equity Contribution; Property Types: Apartments, Industrial, Retail, Office, Mixed Use, Hotel; Geography: Major Markets Nationwide | | | If you have an inquiry regarding George Smith Partners' commercial real estate financing, asset sales or advisory services please contact your GSP representative or Todd August, Chief Operating Officer, at (310) 867-2995 or taugust@gspartners.com. | | | Pascale's Perspective | The Fed continues to gradually pull back from the emergency measures instituted in late 2008 as we move beyond the credit crisis. The pull backs include the recent 0.25% raise in the discount rate and the winding down of Mortgage Backed Secuerities (MBS) purchases. However, the ensuing recovery is described as "nascent" and "fragile", therefore the Fed is keeping the Fed Funds rate at virtually zero "for an extended period". The debate among Fed watchers is: does that mean until 2010 or fall 2009? The MBS program was part of the "quantitative easing" which keeps residential rates from rising. Will private investors support MBS purchases after the Fed stops purchasing later this month? Also, what will happen when the Fed inevitably becomes a net seller of MBS? These will be true tests of the secondary mortgage market.....Stay tuned...David R. Pascale, Jr. | | | Join Us on LinkedIn | George Smith Partners is now on LinkedIn.....Click here to join the George Smith Partners group to get access to current conversations and topics. | | | Press Box | Gary Mozer was quoted in multiple stories regarding Mezzanine financing for multifamily. See stories in Nasdaq.com and HousingFinance.com
Steve Bram commented on the massive Peter Cooper Village/Stuyvesant Town loan default and workout in GlobeSt.com. |
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©2010 George Smith Partners, Inc. DRE # 00822654 FINfacts is an ePublication of
George Smith Partners, Inc. For Promotional Purposes Only. All Rights Reserved.
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