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$35,000,000 High Leverage Construction Loan for 40 To-Be-Built Condominiums; Near Lake Tahoe

Term: 24 months plus one 1-year extension option
Loan To Cost: 80%
Prepayment Penalty: 12 months minimum interest

Transaction Description:

George Smith Partners successfully secured $35,064,000 (80% Loan to Cost) in non-recourse construction completion debt financing for a luxury condominium property near Lake Tahoe. The 40-unit project is located in a tertiary market near ski resorts and overlooks Lake Tahoe. The Sponsor acquired the land and existing, partially completed, four-story concrete and steel structure and underground parking garage at a deep discount as an REO from a bank in 2015. Engineering and architectural updates were completed prior to loan closing.

The for-sale, residential product in a tertiary market presented challenges to the capital markets. GSP was able to source a lender who was familiar with the market, comfortable with the basis, comfortable with the barriers to entry and strong market demand for the product.

Advisors

Related Financings

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    September 8, 2021

    Transaction Description:

    George Smith Partners successfully arranged $20,530,000 in non-recourse senior construction financing for The Surf, a beachfront condominium project in Cocoa Beach, FL. The Project consists of 25 luxury residential units with sale prices ranging from $975,000 to $2,500,000, as well as 3 ground floor retail units. The Project is currently 75% pre-sold. Per Florida statutes, any buyer deposit amount over 10% of the purchase price may be used towards development costs, but a large portion of those deposits are not due from buyers until building top off. GSP was able to successfully secure a lender comfortable with crediting future deposits to decrease the Sponsor’s up-front equity requirement.

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    Rate: WSJ Prime +4.50%
    Term: 24 Months + Two 2-Month Extensions
    Amortization: Interest-Only
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    Prepayment: 6 Months Minimum Interest
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  • $16,500,000 Senior Construction Financing, 79% LTC for 57-Unit Multifamily Development; Toluca Lake, CA

    March 3, 2021

    Transaction Description:

    George Smith Partners secured $16,500,000 of senior construction financing for the development of a 57-unit multifamily building in Toluca Lake, CA. The Sponsor purchased three contiguous lots with this development in mind. The combined land area of the lots allowed them to increase the density of the single-building Project.

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    Rate: WSJ PRIME + 0.375% (4.650% Floor Rate)
    Term: 18 Months plus Two, 3-Month Extension Options
    Amortization: Interest Only
    LTC: 79%
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  • $40,000,000 Construction Completion Loan at 8.00% Fixed, Interest-Only on a 192-Unit Multifamily; Vancouver, WA

    January 27, 2021

    Transaction Description:

    George Smith Partners successfully arranged $40,000,000 in construction completion financing for a 192-unit multifamily community in Vancouver, WA less than 12 miles from downtown Portland, OR.
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  • Construction Debt – 79% LTC – 81 Multifamily Units, Los Angeles, CA

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    Transaction Description:

    George Smith Partners secured senior construction financing for a new multifamily development in the Lincoln Heights neighborhood of Los Angeles, CA. The $10.5M loan will be utilized to complete the 81-unit project. The loan represents approximately 79% of the project cost and was structured with an 18-Month initial term and interest only payments for the duration. The Project will be comprised entirely of studio units configured at 540 square feet; each unit will include one bathroom, a full kitchen, modern appliances, and a washer and dryer. Amenities for the project include a roof top deck, barbeque area, gym & recreational room, bicycle storage, secured parking, and access to a swimming pool.

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  • $40,700,000 Non-Recourse Ground-Up Apartment Construction Financing to 85% LTC with a Blended Rate of 6.80%; San Diego, CA

    December 9, 2020

    Transaction Description:

    George Smith Partners successfully placed the $40,700,000 construction financing, which funded up to 85% loan to project costs for the construction of a 170-unit apartment community located in a southern San Diego submarket. The financing structure included a senior construction loan up to 55% loan to cost and a mezzanine tranche up to 85% of total project costs. The non-recourse mezzanine tranche is structured on an accrual basis, further reducing the total economic impact of the mezzanine financing on the project. The full capital stack is non-recourse. Additionally, the capital partners gave credit for a lift in land value above the actual cost due to the Sponsors prior entitlement work and achieving approvals. While navigating these unprecedent times in the capital markets brought upon us by the COVID-19 Pandemic, GSP utilized our extensive experience, long-standing lender relationships, and capital markets creativity to achieve the Sponsors goals in order to break ground and deliver a much-needed product type in the market.

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    Fee: 1.00%

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  • $9,400,000 Construction Financing for Luxury Apartment Development; Los Angeles, CA

    February 5, 2020

    Transaction Description:
    George Smith Partners successfully arranged $9,400,000 in non-recourse construction financing for the development of a 15-unit luxury apartment building in West Los Angeles. The Property will be comprised of a mix of 1-bedroom and 2-bedroom units and will include 28 parking spaces. The Class A asset sits in a prime location that adjoins some of Los Angeles most sought-after submarkets. Upon completion tenants will have world class views and easy access to major thoroughfares of the City.

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