George Smith Partners

GSPartners

Volume XV | No. 5 | February 22, 2007

KEY RATE INDICES
Prime Rate	8.25%	1 Month LIBOR	5.32%	5 Yr US Treasury	4.72%	5 Yr Swaps	5.14%
12-MAT	4.98%	3 Month LIBOR	5.36%	10 Yr US Treasury	4.73%	10 Yr Swaps	5.24%
11th District COFI	4.40%	6 Month LIBOR	5.38%	30 Yr US Treasury	4.82%

Transactions of the Week

Transaction Description:

$210,000,000 (80% LTC) Construction Financing for a 439,600 Sq. Ft. Retail and Entertainment Center in Anaheim, CA. GSP arranged a $210,000,000 senior construction loan to develop a 439,600 sq.ft. retail and entertainment center strategically located between Disneyland, Disney’s California Adventure theme park, and the to-be-built third Disney theme park in Anaheim, California. The property is approximately 60% pre-leased and includes specialty retailers, restaurants, entertainment uses, a transportation center, a 3,200 space parking facility and air rights for 400 timeshare units. The lender provided a fully underwritten loan with the intent to syndicate after closing and agreed to a limited completion guaranty.

The terms of this transaction are confidential.

Key Players: Scott Bottles, Gary E. Mozer, David Bierman

Transaction Description:

$28,350,000 (87% of Project Cost) Construction Financing for a 93 Unit Mixed-Use Project. GSP arranged $28,350,000 of senior construction financing (87% of total project cost) for the in-fill construction of a 93 unit multifamily development with 15,600 sq. ft. of ground floor retail and subterranean parking. The site is located adjacent to West Hollywood, CA.

Challenge: The requirement was to secure maximum leverage, limited-recourse construction financing. Additionally, the soil and groundwater beneath the site have existing environmental conditions that are currently under remediation.

Solution: The loan structure provides two funding phases: pre-development environmental remediation and then construction draws.

Rate: 30 Day LIBOR + 1.90%

Term: 3 yrs

Amort: Interest Only

LTC: 87%

Lender Fee: 0.875%

Recourse with “burn off” provisions

Key Players: Larry Wilemon, David Bierman, Lee Norman

Transaction Description:

$21,400,000 Fixed Rate Refinance of a 347 Unit Multifamily Project in Rialto, CA. GSP arranged the refinance loan for a 347 unit apartment complex located in Southern California. The borrower acquired the property in 2005 using tax-exempt bond financing subject to an affordable housing requirement for 20% of the rentable units. The borrower was able to return equity capital and continue its aggressive business plan through an accretive recapitalization during the first year of ownership. While this short-term investment strategy would typically utilize a LIBOR based facility, GSP was able to secure fixed-rate financing at substantially lower rates with full term interest-only. Additionally, the lender allowed for the reconveyance of the existing bond financing to remain in place through a defeasance escrow.

Rate: 5 Yr T + 1.22%

Term: 5 yrs

Amort: Interest Only

LTV: 68%

DCR: 1.35

Prepayment: Lockout for first 3 yrs; YM for 4th yr; open during last 12 months

Non-recourse

Nominal Guaranty: $1,000,000 guaranty in the event that tax exemption is forfeited.

Key Players: Steve Bram, Steven Yazdani

Hot Money

Nationwide Lender Offering Low Fixed Third Party Costs on loans up to $20,000,000. Fixed rate, non-recourse debt at competitive spreads with all third party costs capped at application, including lender legal fees. We typically see this structure for loans at or below $5,000,000, but this national lender will now cap costs on transactions to $20,000,000.

· No phase I required for transactions under $3,500,000

· 30 year amort available

· 5, 7, 10, 15 year terms

· 60 day close

· Capped costs, including legal - $12,500 - $20,000

· Multifamily and Commercial - manufactured housing, office, retail, industrial and self-storage

· Loans $1,000,000 - $20,000,000

· Streamlined loan documents

Join Us As We Reach New Heights

George Smith Partners is in the midst of a record-setting period of growth. As we continue to reach new heights, we are selectively seeking several seasoned and successful financial professionals to join our team. Please direct confidential inquires to Todd August, Chief Operating Officer, at (310) 557-8336, Ext. 125.