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$31,633,000, Full-Term Interest-Only, Permanent Financing for Non-Credit Tenanted Office; Suburban Salt Lake City, UT

Rate: 3.54%
Term: 10 Years
Amortization: Full Term Interest Only
Prepayment: Defeasance until last 6 Months which are open with no penalty.
Guaranty: Non-recourse except for “bad acts” and environmental

Transaction Description:

George Smith Partners successfully placed $31,633,000 in permanent financing for an office building in the Salt Lake City area amidst election uncertainty and COVID-19. In particular, pandemic restrictions and the proliferation of “work from home” concerned many lenders that office may face a very slow recovery. Although the Building’s sole tenant was non-credit, their long lease term and exceptionally strong financials motivated the Lender to provide a competitive quote. Well-located in a fast-growing market, GSP structured loan terms that were highly conducive to the Sponsor’s long-term plan and guided the transaction to an expedient closing.


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    Transaction Description:

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    Term: 7 Years
    Amortization: Interest only for 24 Months; 25-year amortization thereafter
    Yield Maintenance: None
    Recourse: Entity-level only

  • $3,900,000 Cash-Out Permanent Financing with Full Term Interest-Only After Exchange; Los Angeles, CA

    July 2, 2019

    Transaction Description:

    George Smith Partners financed the purchase of a mixed-use retail/office building in Los Angeles, California, last year, using a 1031 exchange. GSP used our vast experience with tax differed exchanges to arrange a cash-out financing with a seven-year fixed rate and is full term interest-only. The cash- out was used to purchase a new property and the Sponsor was able to reinvest their entire exchange in the purchase to differ any taxable gain. The new refinance allowed the Sponsor to pull cash out from the property tax free and use that cash to grow his real estate portfolio. While the cap rate at purchase was very low, the Property’s value will continue to increase due to its location in a great Los Angeles neighborhood. In a traditional loan, the Borrower would be limited on the loan size and cash flow but structuring the full term interest-only loan allowed the Sponsor to achieve positive cashflow and acquire the new asset without issue.

    Rate: 4.9%
    Term: Fixed for 7 Years
    Amortization: Full Term Interest only
    LTV: 70%
    Prepayment: 4,3,2,1
    Guaranty: Non-Recourse
    Lender Fee: None