Transaction Description:

George Smith Partners placed a $37,500,000 non-recourse, stretch senior construction loan for a 7-story ground-up development of a mixed-use OpZone Project. When complete, the Project will consist of 151 apartment units (including 14 Live/Work Lofts), approximately 15,000 sf of restaurant space, 10,000 sf of retail, and 12,000 sf of office space. The average apartment size is 730 sf, and most units will have private balconies with unobstructed views of the desert and city.

As the Project is a first of its kind in the surrounding area, finding appropriate comparable projects that would speak to the strength of this market proved to be a challenge. GSP focused on the Project as a marquee development and detailed the new employment opportunities from Google, and a hospital expansion, sports training facility, along with the emerging renaissance happening within the downtown area. GSP was able to demonstrate the immense intrinsic value from the ongoing renovation of the City Hall Plaza and Events Center — a 500-seat canopied amphitheater and 60,000 sf of programmable deck area for hosting community events — that sits directly across from the Project. GSP also worked through the Sponsor’s GMP budget with the Lender during a period of escalating cost, showcasing the strength of the Sponsor group in their local market. In turn, this created a comfort level needed by the Lender with regards to the commercial space of the Project.

GSP executed a broad and in-depth marketing campaign to help capital markets understand the opportunity appropriately. These efforts resulted in a successful close with proceeds achieving the Sponsorship’s objective.

Loan-To-Cost: 75%
Stabilized Loan-To-Value: 70%
Term: 24 Months + 6 Month Extension
Amortization: Interest-Only
Guaranty: Non-Recourse