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

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

Subscribe Here

$13,777,000 Portfolio Refinance for 5 Multifamily Properties, Non-Recourse, Cash-Out, Interest Only, No Payment Reserves; Los Angeles, CA

Rate: 3.35% Fixed
Term: 5 Years
Amortization: 5 Years Interest Only
LTV: 65%
DSCR: 1.25x
Prepayment: 3,2,1
Loan Fee: Par
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners placed 5 non-crossed loans totaling $13,770,000 to complete the refinance of a 67-unit multifamily portfolio in Los Angeles. The financing represents a significant return of equity to the Sponsorship while simultaneously lowering their previous interest rate. The loans all carry a fixed interest rate of 3.35%, a 5-Year term, and include interest only payments ranging between three and five years. In contrast to many lenders that are currently structuring six to twelve months of P&I reserves, GSP successfully negotiated waiving any shortfall structure.

Given the current market challenges (stemming primarily from COVID) even multifamily properties are experiencing additional scrutiny from both underwriters and appraisers. Despite these new hurdles, GSP was successful in maintaining the loan proceeds originally represented in the application. Through a combination of presenting real-time comparable market data to the appraiser and working with the Lender to increase the initial LTV stipulation, GSP overcame the valuation issues that arose as a result of the final appraisal. After presenting market data on a number of similar stabilized asset transactions we demonstrated that LA multifamily properties with consistent occupancy and collections have exhibited minimal value declines, ultimately convincing the Lender to increase the LTV constraint from 60% up to 65% and preserving the full cash-out proceed amounts.


Related Financings

  • No related financings.