| Transaction Description: |
| $7,760,000 Fixed Rate Permanent Financing (80% LTC) for 66,840 Sq. Ft. Grocery-Anchored Shopping Center in Houston, TX. GSP arranged permanent financing for the acquisition of a 66,840 sq. ft. shopping center in Houston, TX. The property is 82% leased with four of ten leases expiring within the next two years. The Borrower is an experienced real estate owner, developer and operator. This is the second grocery-anchored shopping center the Borrower has acquired in the past three months; both transactions were closed with the same lender. |
Challenge: Obtaining full funding at closing despite the property’s high vacancy rate. The seller provided the Borrower with rent guarantees to mitigate some recent new vacancies; however, the lender would not underwrite this rent as income and intended to structure an earnout. |
Solution: Initially GSP arranged for the Borrower to post a letter of credit equal to three years of lost cash flow, (which was substantially less than the amount the Borrower would have had to earn out); however, GSP ultimately negotiated a full funding at closing without the need for the additional credit support. |
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| Rate: 10 Yr T + 1% |
| Term: 10 yrs |
| Amort: Interest Only |
| LTC: 80% |
| DCR: 1.36 |
| Prepayment: Defeasance |
| Non-recourse |
| Lender Fee: Par |
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Key Players:
Gary M. Tenzer, Bryan Berkett
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