$1,253,000 Acquisition Bridge Loan at a 4.50% rate

Transaction Description: George Smith Partners arranged a $1,253,000 bridge loan for the acquisition of an 8-unit, value-add multifamily property in Long Beach, California. Sized to 70% of total project cost, the loan includes 100% of future funding for property renovation, which includes a full gut renovation of unit interiors and an exterior upgrade. The two year bridge loan is interest only and floats at Prime plus 0.5% with no prepayment penalty. Interest is not charged on the hold back until funds are drawn and the lender fee was 0.5%. The property is located in an area of Long Beach that is within a growth corridor, but has yet to gentrify.  The sponsor’s plan includes noticing all below market leases in a fairly short window. By emphasizing the sponsor’s track record of re-positioning similar properties as well as current market rents and occupancy, GSP was able to assist the lender in gaining comfort with the market. The loan was structured with an interest reserve to mitigate the property’s weak cash flow during the renovation period. The loan closed in 45 days from start of application.