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

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

Subscribe Here

$3,200,000 Refinance Loan For 18-Unit Live/Work Property in Oxnard, CA; 5 Years Fixed at 3.0%; Three Years Interest Only Payments

Rate: 3.0%
Term: 5 years
Amortization: 3 Years Interest-Only
Prepayment Penalty: 3,2,1%
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners arranged a $3,200,000 loan for the refinance of a stabilized 18-unit live/work property in Oxnard, California. The Property is a former warehouse that has been converted to apartments. They have been converted to allow tenants to run small businesses from their units. Although the Property is permitted as multifamily, some lenders declined the deal due to this unique use. GSP was able to find a lender that provided a 3.0% fixed rate, which is well below current market interest rates. Compared to the previous loan, the new interest rate is more than 1% less. The Lender was also able to provide non-recourse financing and 3 years of Interest-Only payments.


Related Financings

  • $6,850,000 Multifamily, Cash-Out Refinance; Los Angeles, CA

    August 10, 2022

    Transaction Description:

    George Smith Partners secured $6,850,000 for the refinance of a stabilized 58-unit Los Angeles apartment building. The loan is fixed at 4.15% for five years and has full-term interest-only payments. The Lender offered a 60-day rate lock, which provided a great benefit to the Borrower because interest rates increased while the loan was in application. A fast-paced closing process was required to keep the rate locked at 4.15%. GSP ensured that all stakeholders adhered to the timeline and that the loan successfully closed on the required date. There were no changes to the term sheet.

    Rate: 4.15% Fixed for 5 years; 30-Day Average SOFR + 2.35% Thereafter
    Term: 30 years
    Prepayment Penalty: 3, 1, 1, 1%
    LTV: 55%
    DCR: 1.20x
    Origination Fees: Par

  • $4,200,000 Refinance of Luxury Condominium; Beverly Hills Adjacent, CA

    November 29, 2021

    Transaction Description:

    George Smith Partners arranged a $4,200,000 loan collateralized by a three-story, luxury condominium located adjacent to Beverly Hills, CA. The Property had three recorded notes with the 2nd trust deed already in maturity default. GSP used its strong lender relationships to source a quick close solution to refinance two of the three notes with a new short-term loan that required the 3rd trust deed to subordinate to the new lender.

    Rate: 6.4% Fixed, Interest-Only
    Term: 1 Year
    LTV: 63%
    Prepayment: None
    Guaranty: Non-Recourse
    Lender Fee: 1%

  • $9,882,000 Refinance for 32-Unit Multifamily Property, 3.49% For 10 Years, 6 Years Interest-Only; Los Angeles, CA

    November 17, 2021

    Transaction Description:

    George Smith Partners secured $9,882,000 in proceeds for the refinance of a newly stabilized 32-unit property in the Palms neighborhood of Los Angeles. The loan is fixed at a rate of 3.49% for 10 years, with 6 years of interest-only payments. The loan is non-recourse and has no payment reserves.

    Several challenges were encountered when discussing the transaction with capital providers. The Property had just reached stabilization, so GSP had to find a lender that would include the income from newly signed leases without requiring several months of operating history. The Sponsor desired to lock their low rate for 10 years. This eliminated bank financing as an option because banks price up for longer term loans. Some CMBS lenders offered very competitive rates, but the Sponsor wanted an easy and low-cost closing process. As a result, Agency financing was the best option for a 10-year fixed rate loan with partial term on interest-only payments. While in application, extensive data from comparable properties was used to support proforma expenses and maintain underwritten cash flow. The loan closed in about 60 days.

    Rate: 3.49% fixed for 10 years
    Amortization: 6 years Interest Only followed by 30 year amortization
    Prepayment Penalty: Yield Maintenance
    LTV: 65%
    DCR: 1.25x
    Guaranty: Non-Recourse

  • $12,083,000 Non-Recourse Cash-Out Agency Refinance for Multifamily Property; Western States

    June 16, 2021

    Transaction Description:

    George Smith Partners successfully arranged the cash-out refinance of a 200+ unit multifamily property. The loan is floating at a starting rate of 2.56% and allows the Sponsor to complete a value-add strategy to increase the NOI and refinance into a permanent loan at higher proceeds in 18-24 months.

    While processing the loan, GSP worked with the Lender to understand the historical cash flow which was extremely choppy due to the inconsistent rent payments during the Covid-19 pandemic. The analysis resulted in a $3,000,000 increase to the loan amount and an additional year of interest only payments.

    Rate: 2.55% + SOFR
    Term: 7 Years
    LTV: 65%
    Amortization: 3 Years Interest Only, 30 Year Am Thereafter
    Prepayment: 1-Year Lockout, then 1%
    Guaranty: Non-Recourse

  • $10,895,000 Cash-Out Refinance of a 2-Property Multifamily Portfolio at 3.15%; Los Angeles, CA

    January 20, 2021

    Transaction Description:
    George Smith Partners was retained to refinance a 2-Property multifamily portfolio. Sensing buying opportunities in the multifamily market, the Sponsor wanted to pull cash out of their existing multifamily portfolio to use as equity to purchase new properties. GSP obtained a fixed rate of 3.15% for the first 5 years of the 30-year term.

    With the global pandemic and uncertainty in the market, it was critical to select a capital provider who could successfully close and provide the cash out for the additional purchases. Any delays would have been very costly because of penalties in the purchase contract. In addition, most lenders were overwhelmed with year-end financing requests as several other lenders pulled out of the market and forbearance requests from their current borrowers. There were complex issues around appraisals and inspections that required GSP’s daily oversight.

    Because of GSP’s strong relationship with this capital provider, we were confident that the loan officer would stay focused, close on time and keep the agreed rate and proceeds. GSP is in the debt market every day which gave us the ability to ensure that the selected Capital Provider was closing deals and meeting deadlines. GSP’s experience working with appraisers, inspectors and title/escrow during the COVID period was critical to getting this transaction completed in a timely manner. The loan closed on time and the Sponsor was able to utilize the cash-out to purchase another project. As is common during the COVID crisis, the Capital Provider wanted a 12-month payment reserve. GSP was able to convince the Capital Provider to only require 6-months and allow the reserve to be applied to the first 6-months of payments.

    Rate: 3.15%
    Term: 30 years term, fixed for first 5 years, resets every 5 years after for the term.
    LTV: 70%
    DCR: 1.20

  • Permanent Multifamily Financing Secured During COVID-19 Pandemic, 3.07% Fixed for 5 Years; Los Angeles, CA

    July 15, 2020

    Transaction Description:

    George Smith Partners arranged $2,600,000 in permanent financing for the refinance of a stabilized 8-unit, multifamily property in Los Angeles, California. The Sponsor acquired the Property a few years ago and was looking to lower their rate as they finished completion of a light renovation. As the environment was changing drastically day to day with the COVID-19 pandemic, GSP identified a Capital Provider offering fantastic terms. There were no holdbacks, no deposits were required to be held at their branch and provided a flexible prepayment penalty structure that allowed the Sponsor plenty of options during these challenging times.

    Rate: 3.07%
    Term: 5 Years Fixed
    Amortization: 30 Years
    Prepayment Penalty: 2, 1, 0
    LTV: 60%
    DCR: 1.25
    Lender Fee: None
    Reserve Account: None
    Deposits Required: None