Don't Miss a Fact,
Sign Up for FINfacts!

FINfacts is a weekly newsletter highlighting recent financings and economic insights.

Subscribe Here

Perm

  • Expand

    $10,250,000 Permanent Financing for 100,000 SF Grocery Anchored Shopping Center; Northern California

    October 4, 2023

    Transaction Description:

    George Smith Partners arranged 5 year, permanent, non-recourse, interest only financing for an 85% occupied, multi-tenant shopping center in Northern California. The Property is a neighborhood center with 20 tenants and anchored by an independent grocery chain with about 20 locations in 5 states. The grocer has a long history at the center with over 25 years and multiple lease renewals. Other tenants include a mix of local and national chain restaurants, dental care, hair care, and a pre-school. The Sponsor was able to execute new financing near their existing loan maturity. Choosing a 5 year structure allows flexibility in the next 3 or 4 years and minimize prepayment costs. The CMBS financing allowed for a cash-neutral, non-recourse refinance in a volatile capital markets environment.

    Rate: 7.88%
    Term: 5 Years Fixed
    Amortization: Interest Only
    LTV: 50%
    Prepayment: Defeasance
    Lender Fee: 1%
    Guaranty: Recourse

  • Expand

    Permanent Financing for a 14-Unit Multifamily Property; Los Angeles, CA

    July 19, 2023

    Transaction Description:

    George Smith Partners closed a refinance loan on a 14-unit Los Angeles multifamily rental with a California-based credit union. The loan is fixed at 4.93% for 5 years, a rate that is at least 60 basis points lower than the rest of the market. The prepayment schedule is 5%, 4%, 3%, then open in the 4th year. This will give the borrower flexibility to refinance if interest rates decline. The loan did not require the borrower to maintain any deposits with the Lender.

    Rate: 4.93% Fixed for Five Years
    Term: 30 Years
    DCR: 1.25x
    Lender Fee: Par
    Prepayment: 5,4,3, open

  • Expand

    $14,100,000 Permanent Acquisition Financing for High Street Retail Property; Chicago, IL

    April 19, 2023

    Transaction Description:

    George Smith Partners secured $14,100,000 in permanent financing for the acquisition of a 5,666 square-foot luxury, high-street retail property located at 909 N. Michigan Avenue, in the heart of Chicago’s Magnificent Mile Shopping District. The three luxury retail tenants include Bulgari, Omega Watches, and Chicago’s own Burdeen’s Jewelry. The Sponsor purchased the retail parcel from the owner of the Westin Michigan Avenue Chicago for $27,300,000, approximately $4,818 per square foot.

    During the closing process, the capital markets experienced considerable volatility with the fallout from Silicon Valley Bank and First Republic Bank causing a seismic shift to the debt markets prior to funding of the loan. George Smith Partners was able to hold proceeds on the loan and closed the 5-year fixed rate note with full-term interest only by leveraging our lender relationships and augmenting with appropriate structure.

    Rate: 6.75% Fixed (Index + 2.77%)
    Term: 5 Years
    Interest-Only: Full Term
    LTV: 50%
    Debt Yield: 15%
    Guaranty: Non-Recourse

  • Expand

    Permanent Financing for NNN Single Tenant Retail; Mechanicsburg, PA

    February 1, 2023

    Transaction Description:

    George Smith Partners arranged $3,669,250 in fixed-rate financing to refinance a single-tenant NNN Rite-Aid located in Mechanicsburg, Pennsylvania. GSP sourced a lender that would provide 10-year, fixed-rate debt with no prepayment penalty in order to give the sponsor maximum flexibility. The financing is fixed at 4.98% amortizing over a 30-year period. Rite Aid signed a 26-year lease that expires at the end of the loan term. The tenant’s lease includes four 5-year options at fixed rents.

    Rate: 4.98% Fixed
    LTV: 65%
    Term: 10 Years
    Origination Fee: 0.25%
    Amortization: 30 Years
    Prepayment: Open
    Guaranty: Recourse

  • Expand

    $14,430,000 Permanent Financing for a Newly Developed Student Housing Property; Memphis, TN

    January 25, 2023

    Transaction Description:

    George Smith Partners secured a $14,430,000 permanent loan for an 85-unit, 208-bed, student housing property near the University of Memphis. The Sponsor was able to lock rate at application and secured the 5.41% fixed rate for seven years. In a rising rate environment, the ability to lock rate at application gave the Sponsor confidence in the terms of the loan and provided a clear path to closing. Prior to the refinance, the Property was encumbered by the construction loan having been recently completed in 2021. The Property was extremely successful in its first year of operations, having leased up to over 90% occupancy. During GSP’s marketing process, the property was significantly pre-leased for the upcoming school year providing lenders with the assurance of forward cash flows and clarity in their underwriting process. GSP contacted a variety of lenders including life insurance companies, CMBS lenders, and banks to provide the client with a wide variety of avenues to capture the most competitive lending terms in the current economic environment.

    Rate: 5.41% (7-Year Treasury + 2.40%)
    Term: 7 Years
    Origination Fee: Par
    LTV: 62.5%
    Prepayment: Yield Maintenance Years 2-4, 2%, 1%, 0%
    Guaranty: Non-Recourse

  • Expand

    Permanent Multifamily Financing; Los Angeles, CA

    January 11, 2023

    Transaction Description:

    George Smith Partners arranged $3,800,000 in permanent financing for the refinance of a stabilized 39-unit multifamily property in Los Angeles, California. The Sponsor locked rate in early summer of 2022 during a time of rapidly increasing interest rates. Due to some unforeseen events, the transaction got delayed multiple times. GSP was able to get the rate lock extended multiple times due to our relationship with the Capital Provider. The rate lock was extended without a single increase to the rate or any additional fees. The loan includes a flexible prepayment penalty structure that allows the Sponsor plenty of options during the next 5 years as well as over $1,500,000 in cash-out proceeds.

    Rate: 4.25%
    Term: 5 Years Fixed
    Amortization: 30 Years
    Prepayment Penalty: 3/2/1, Then Open
    Deposits Required: None
    Guaranty: Non-Recourse

  • Expand

    $3,830,000 Refinance of a 11-Unit Multifamily Property; Los Angeles, CA

    January 5, 2023

    Transaction Description:

    George Smith Partners arranged $3,830,000 in permanent financing on a newly stabilized 11-unit multifamily property located in Austin, TX. The loan is fixed at a rate of 6.00% for 10 years and a 3-3-3-2-1 prepayment structure. Although some lenders were hesitant to provide competitive permanent financing terms on a former condo multifamily property with less than a year of operating history, GSP was able to source competitive financing ahead of the rising interest rate environment with flexible prepayment. Thanks to our long-standing relationship with this repeat lending relationship, GSP was able to meet the Sponsor’s deadline and close this transaction within 43 days from signing the term sheet.

    Rate: 3.50%
    Term: 10 Years
    LTV: 70%
    Prepayment: 5, 4, 3, 2, 1%

  • Expand

    Perm Financing for a Multifamily Property; Houston, Texas

    June 29, 2022

    Transaction Description:

    George Smith Partners secured permanent financing for an eight-unit multifamily property located in Houston, Texas. The loan is fixed at a rate of 4.00% and locked in for 7 years. The deal went into application during the Fed run-up in rates and the rate was never locked. However, due to GSP’s relationship with the Lender, we were able to hold the rate and term down substantially. The financing does not require any deposit relationship with the bank and did not require any funds to be held back for reserves. The Lender’s processing/application fee was $2,000 all in.

    Rate: 4.00%, Fixed for 7 Years
    Term: 30 Years
    Amortization: 30 Years
    LTV: 70%
    Prepayment: 5, 4, 3, 2, 1%
    Depository Relationship: None Required

  • Expand

    $6,100,000 Perm Financing for an Unanchored Retail Property; Bakersfield, CA

    June 22, 2022

    Transaction Description:

    George Smith Partners successfully closed a loan at 60% loan-to-value for an 84% occupied, newly built, and stabilized retail center in Bakersfield, CA. GSP located a lender that was able to lock the rate of 4.125% at application to avoid the rate volatility in the market. Many lenders were not comfortable quoting the deal because of the lack of operating history. GSP was able to locate a lender that was comfortable with the lack of history, with a 6-month debt service reserve held back at closing, to ensure that the tenants continue to pay rent. The reserve is released after 6 months of full rent collection.

    Rate: 4.13%
    Term: 7 years
    LTV: 70%
    Amortization: 1 Year IO, then 25 Year Amortization
    Prepayment: None
    Fee: None
    Guaranty: Full Recourse

  • Expand

    Cash-Out Refinance with LifeCo for Unflagged Boutique Hotel; Tucson, AZ

    June 1, 2022

    Transaction Description:

    George Smith Partners secured permanent financing for an unflagged, 90-key, boutique art hotel in Tucson, AZ. The Sponsor acquired the Property in 2017, and completed a full renovation and rebrand in 2018, primarily with cash. The Hotel performed extremely well prior to the pandemic. While revenue and NOI declined, along with most hospitality assets during that time, the Property has since recovered to and exceeded pre-pandemic levels. Despite the Property being unflagged and located outside downtown Tucson, GSP was able to leverage its strong lender relationships to source CMBS and Life Insurance Company quotes. The Sponsor ultimately chose a LifeCo lender who offered a combination of low rate, longer amortization, prepayment flexibility, and potential to increase proceeds during the loan term.

    Rate: 4.59% Fixed for 5 Years
    Term: 15 Years (5+5+5)
    Amortization: 27 Years
    LTV: <40%
    Guaranty: Partial Recourse

  • Expand

    $15,100,000 Cash-Out Refinance of a 5-Property Multifamily Portfolio at 3.40% – 70% LTV; Los Angeles, CA

    April 11, 2022

    Transaction Description:

    George Smith Partners arranged $15,100,000 in permanent financing for the refinance of a 5-property multifamily portfolio located in Los Angeles, CA. Using GSP’s vast network of relationships, we were able to source and quickly lock fixed rate financing in a market that is seeing rising interest rates. The Sponsor also wanted to pull cash out of their existing multifamily portfolio to use as equity towards purchasing new properties. The Sponsor had recently completed exterior and interior renovations including common area upgrades to all five properties. The recent improvements allowed the Sponsor to increase rents thus increasing the value of the Property. GSP was able to provide the Sponsor with a 30-year term, with the first 5 years being fixed at a rate of 3.40%. The loan represents 70% loan to value with a minimum 1.20 DSCR. The flexible stepdown prepayment structure is equal to 5,4,3,2,1. The cash-out loan allows the Sponsor to use more equity towards growing their multifamily portfolio. Thanks to GSP’s long-standing relationship with this bank lender, we were able to meet the Sponsors deadline and close this transaction within 35 days from signing the term sheet.

    Rate: 3.40%
    Term: 30 years term, fixed for first 5 years
    LTV: 60%
    DCR: 1.20

  • Expand

    $3,870,000 Cash-Out Permanent Financing Loan for 44-Unit, Multifamily Property; Los Angeles, CA

    March 16, 2022

    Transaction Description:

    George Smith Partners arranged $3,870,000 in cash-out permanent financing for the refinance of a 44-unit multifamily property located in Los Angeles, CA. GSP was able to time the refinance of the more expensive lender and lock the rate before the interest rate market started to move upwards. The recent improvements allowed the Sponsor to increase rents thus increasing the value of the Property. GSP was able to provide the Sponsor with a 10-year term, and the first 7 years being fixed at an incredibly low rate. The flexible prepayment structure is equal to 2% for the first 2 years, 1% for years 3 and 4, and 0% thereafter. The loan structure allows the Sponsor to refinance out of an expensive loan with a fixed rate of 3.15%, while also receiving cash out. The Sponsor is using cash-out proceeds to continue their business plan of purchasing and renovating additional properties.

    Rate: 3.15% (Fixed for 7 Years)
    Term: 30 Years
    LTV: 60%
    DCR: 1.20