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Retail

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    $13,500,000 5-Year Financing for The Glen Centre in Beverly Hills/Bel Air

    February 8, 2024

    Transaction Description: 

    George Smith Partners successfully arranged a $13.5 million refinancing on behalf of the owners of The Glen Centre, an irreplaceable 44,000 square-foot boutique retail center located in the heart of the Beverly Hills/Bel Air area.

    Originally financed 10 years ago by GSP, the new 5-year loan was used to refinance existing CMBS debt on the property that was coming due in February 2024. Serving the surrounding Bel-Air/Beverly Hills community since 1978, this irreplaceable asset was one of L.A.’s first true community shopping centers, designed to meet the needs of surrounding residents by offering one-of-a-kind shops, restaurants and convenient services in a beautiful park-like setting.

    Lender Type: Commercial Bank

    Amount: $13,500,000

    LTV: 40%

    Rate: 285+1-Month SOFR

    Term: 5-years

    Origination Fee: 0.25%

    Prepayment: Open/At-Par

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    $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

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    $7,700,000 Programmatic Equity Financing for 151-Unit Portfolio; Washington, DC

    August 23, 2023

    Transaction Description:

    George Smith Partners has successfully arranged a Programmatic Joint Venture Equity Structure valued at $7,700,000. This strategic arrangement will provide funding for three affordable multifamily projects in Washington DC. These Projects encompass the recapitalization of a fully stabilized property consisting of 49 units, the minor rehabilitation of 56 existing units, and the construction of 87 new ground-up units.

    GSP skillfully orchestrated a programmatic equity agreement that provides investors with improved returns spanning a prolonged period. Consequently, the Sponsor and GSP collaboratively endeavored to secure a steadfast equity provider for their upcoming ventures. Simultaneously, the equity provider gains the privilege of tapping into the sponsor’s expansive project pipeline, thereby opening doors to potential future funding returns.

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    $4,760,000 Acquisition Bridge Financing for Vacant Retail/Restaurant Building; Los Angeles, CA

    August 16, 2023

    Transaction Description:

    George Smith Partners secured a $4,760,000 acquisition loan for a vacant 12,300 square foot retail property in Los Angeles, CA. The Lender provided proceeds of 70% of the acquisition price at a rate of 7.325%, fixed for the first three years. The loan was closed with a regional bank.

    The Property was delivered as a vacant shell. The buyer intends to lease it to restaurant and retail tenants. Given the current market volatility, most of the other quotes were from private money lenders at much higher rates. To support the purchase price and future valuation, an extensive set of sales and lease comps were provided to the lender and the appraiser. The Borrower’s track record of success with similar properties demonstrated their ability to execute their business plan.

    Rate: Fixed for 3 Years at 7.325%, then Floating
    Term: 5 Years
    Amortization: 1 Year Interest Only followed by 25-Year Amortization
    Prepay: 3, 2, 1, 0%
    LTV: 70%
    DCR: 1.25x at Stabilization

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    $3,650,000 Permanent Financing for Office & Retail Property; Santa Barbara, CA

    July 5, 2023

    Transaction Description:

    George Smith Partners successfully closed a refinance of a mixed-use office and retail property in Santa Barbara with a life insurance company. Despite the current market hesitation towards office properties, GSP was able to secure 10-year, fixed-rate financing given the lower leverage. GSP identified a Lender that was comfortable with the office component due to the 30+ small office users and no significant rollover risk. The largest tenants are a restaurant and movie theater which have been in occupancy for over 20 years.

    Rate: 5.93%
    Term: 10 Years
    Amortization: 25 Years
    LTV: 24%
    Prepayment: Yield Maintenance
    Fee: None
    Guaranty: Non-Recourse

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    $9,327,000 Acquisition Financing for Retail Portfolio; Multistate

    May 24, 2023

    Transaction Description:

    George Smith Partners successfully arranged $9,327,000 in acquisition financing for the purchase of three prime retail properties adjacent to top colleges across different states. The properties are all performing very well but do not have credit tenants. Overcoming the reluctance of regional banks to cross-collateralize and the high rates offered by many lenders, we sourced a national bank that could loan on all three properties. The lender provided a seven-year fixed rate term and 4 years of Interest Only payments. The strategic placement of these properties in prime locations is expected to drive significant value appreciation. By structuring the loans with low leverage, we allowed the Sponsor to complete a 1031 exchange. The cross-collateralized loan with release provisions allowed the seamless acquisition of the assets.

    Rate: Fixed at 6.01% for 7 years
    Interest Only: 4 Years
    LTV: 50%
    Guaranty: Non-Recourse

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    $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

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    $11,930,000 Bridge Financing for 3 Properties; Southern CA

    April 5, 2023

    Transaction Description:

    GSP utilized a quick close bridge fund to provide 3 separate loans:
    $7,150,000 Distressed Multifamily Purchase – 80% LTC in Los Angeles
    $2,200,000 Mixed-Use, Retail-Residential – 65%LTV in Los Angeles/Venice
    $2,580,000 Restaurant/Retail – 65% LTV in Pasadena

    George Smith Partners successfully arranged three bridge financings in Southern California. In today’s turbulent market, private quick close options are sometimes necessary. The ability to act quickly often allows our clients to become the chosen Buyer- purchasing these Properties at a large discount or solve a tenant/occupancy issue before a permanent refinance.

    GSP worked with a local REIT to develop a program that includes a first and second private mortgage of up to 85% of acquisition price. With the fund and GSP, the loans are underwritten to the future value, to allow the client to implement their strategy. When used for purchasing a property, the loans are designed to provide the same surety of close as an all-cash buyer, with no appraisal needed and the ability to close as fast as 5 business days. The loans are non-recourse and have no prepayment penalty.

    These loans are cheaper and easier than equity partners and allow the Sponsor to take advantage of opportunities using less cash.

    Blended Rate: 7.9% – 10.5%
    Blended Rate – Based on Leverage
    Loan to Purchase Price: Up to 85%
    Term: 12 Months
    Guaranty: Non-Recourse

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    $4,150,000 Acquisition Financing for Multi-Tenant Retail Center; Charlotte, SC

    March 22, 2023

    Transaction Description:

    George Smith Partners arranged $4,150,000 in fixed-rate acquisition financing for a 100% occupied, 12,558 square foot, 4-tenant, Starbucks-anchored retail center in South Carolina. Located just across the border from North Carolina in suburban Charlotte. The contemporarily designed, 2019-built center is well located with a high traffic count, solid demographics, and includes daily needs that tenants appropriate to its suburban location. Starbucks occupies the end cap and other tenants include an investment-grade urgent care facility, a wine and food bar, and a nail salon. GSP sourced a lender that would provide a 10-year term, with a 5-year fixed rate, and no prepayment penalty, in order to give the sponsor maximum flexibility.

    Rate: 5.66% Fixed for 5 years
    LTV: 57%
    Term: 10 Years
    Origination Fee: 0.25%
    Amortization: 30 Years
    Prepayment: Open
    Guaranty: Recourse

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    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

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    $38,500,000 Cash-Out Refinance of 98% Leased Grocery-Anchored Retail Center; Utah

    February 1, 2023

    Transaction Description:

    George Smith Partners successfully placed $38,500,000 of floating-rate debt for the cash-out refinancing of a 372,000 square foot grocery-anchored retail center located in Utah. Fully leased and anchored by tenants like Super Target, Best Buy, and PetSmart, the Property boasts a dominant submarket position owing to its diverse assortment of community-oriented tenants and main-and-main location. Additionally, the Sponsor had expertly navigated the difficult market conditions caused by the Covid-19 pandemic, notably through subdividing and re-leasing 45,000 SF of space to credit-rated tenants at a rent 70% higher than the previous occupant, which had vacated due to bankruptcy. Loan proceeds were used to pay off existing debt, fund tenant improvements, and leasing commissions, and repatriate Sponsor equity.

    Most non-CMBS lenders contacted had sought a full repayment guaranty because of the retail asset class. However, GSP successfully sourced a flexible lender willing to structure recourse with a 25% springing repayment guaranty, which would only come into effect only if an anchor tenant terminated their lease or ceased operations. Furthermore, the Property’s strong sponsorship and well-executed business plan effectively aided GSP to source debt with an extremely competitive rate and significant cash-out at close.

    Loan Term: 5 Years, 1 year I/O
    Rate: SOFR + 2.46%
    LTV: 65%
    Fee: 1%

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    $38,500,000 Cash-Out Refinance of 98% Leased Grocery-Anchored Retail Center; Utah

    January 5, 2023

    Transaction Description:

    George Smith Partners successfully placed $38,500,000 of floating-rate debt for the cash-out refinancing of a 372,000-square-foot grocery-anchored retail center located in Utah. Fully leased and anchored by tenants like Super Target, Best Buy, and PetSmart, the property boasts a dominant submarket position owing to its diverse assortment of community-oriented tenants and main-and-main location. Additionally, the Sponsor had expertly navigated the difficult market conditions caused by the Covid-19 pandemic, notably through subdividing and re-leasing 45,000 SF of space to credit-rated tenants at a rent 70% higher than the previous occupant, which had vacated due to bankruptcy. Loan proceeds were used to pay off existing debt, fund tenant improvements and leasing commissions, and repatriate Sponsor equity.

    Most non-CMBS lenders contacted had sought a full repayment guaranty because of the retail asset class. However, GSP successfully sourced a flexible lender willing to structure recourse with a 25% springing repayment guaranty, which would only come into effect only if an anchor tenant terminated their lease or ceased operations. Furthermore, the Property’s strong sponsorship and well-executed business plan effectively aided GSP to source debt with an extremely competitive rate and significant cash-out at close.

    Term: 5 Years, 1-year I/O
    Rate: SOFR + 2.46%
    LTV: 65%
    Fee: 1%