$11,800,000 Cash-Out Refinance of a San Antonio Apartment

Transaction Description:   GSP secured an $11,800,000 non-recourse permanent loan for the 33 building apartment complex in San Antonio, Texas. This refi included a $3,400,000 return of equity to the borrower. Fixed at 4.55% for 10 years, the loan was sized to 78% of value and amortized on a 30 year schedule.

Challenge: The Borrower requested maximum cash-out proceeds on a non-recourse basis for alternative investments. The current ownership structure presented significant issues due to 1) an internal layer of equity, structured as a mezzanine note, and 2) a non-profit partner.

Solution: GSP identified a national capital provider headquartered in Texas. Their grass-roots knowledge of this housing market gave them comfort to offer proceeds at 78% LTV even with the excessive return of capital. A lender originated inter-creditor agreement allowed the remaining equity holder, whose interest was structured as a mezzanine note, to be recognized in order to maintain the current ownership structure. This inter-creditor agreement also identified the relationship between the Borrower and its nonprofit partner to avoid restructuring the Borrower.