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George Smith Partners successfully secured $35,900,000 in construction takeout financing for a state-of-the-art industrial project located in the Austin, Texas MSA. The manufacturing, research and office facility is 130,000 square feet. Spanning a 103-acre site, the building offers an additional 93 acres of undeveloped, shovel-ready land, yielding a development potential of more than 1,000,000 square feet of light / heavy commercial and industrial use.
The financing recapitalized construction costs related to the facility development, and utility infrastructure improvements.
The Sponsorship team acquired the undeveloped site in 2019, a strategic parcel in a rapidly developing industrial corridor, and subsequently developed the Class A facility. In order to take out the construction financing, GSP was able to identify a local lender with the expertise to develop a credit profile that appropriately accounted for the startup’s long-term viability, while also understanding the significant value of the excess developable land in a high-growth micro market within the Austin MSA.
$27,300,000 Non-Recourse Construction Financing for Multi-Tenant Spec Industrial Development; Mesa, AZ
January 18, 2022
George Smith Partners arranged $27,300,000 in non-recourse construction financing for the development of a 173,193 SF, Class-A, light industrial project in Mesa, AZ. The Project will consist of smaller unit sizes in 10 total buildings ranging in size from 2,500 to 15,000 SF.
This Project was built entirely to spec. Tenants signing smaller leases typically do not pre-lease space before a project breaks ground. Due to supply chain constraints and inflationary pressures, raw materials and labor costs increased significantly. While there have been many large box industrial projects developed in the market, there has been limited development of small bay product and therefore limited comparable lease and sales transactions. Most of the Sponsor team are foreign nationals whose assets lie outside of the United States.
GSP successfully obtained several financing options and selected a lender who had flexible execution, a strong understanding of the growing demand for small bay industrial space and was comfortable with rising construction prices. GSP arranged a co-guarantor to subsidize the non-recourse carve-out guarantees.
Rate: L + 6.50% with 0.10% Floor
Term: 24 months + (1) 6-month extension
2% origination fee, 0% exit fee
- Advisors: Scott Meredith
April 28, 2021
George Smith Partners arranged $19,550,000 of senior construction financing for a ground-up cold storage facility located in Jurupa Valley, CA. The 125,000 square foot facility will serve as the headquarters for West Coast Cold Storage, a “for rent” cold storage provider focused on providing both refrigerated and frozen space to their Southern California customers. Existing cold storage facilities nationwide have an average age of over 40 years, demonstrating the need for new development within the space. With the sudden increase in online grocery orders and delivery, demand for well-located cold storage space has spiked. This flagship building will feature increased energy efficiencies and provide a variety of racking configurations to accommodate customer needs.
Located two blocks from State Highway 60, the Subject Property offers clients immediate access to the entire Inland Empire and Northern San Diego County. This location is also part of the Port of Los Angeles transportation line that handles 20% of incoming U.S. cargo and feeds all Southern California.
Structured to minimize the Sponsor’s equity investment, the non-recourse loan is sized to 81% of development costs and carries an 18-month term. Minimum interest requirements were negotiated to less than 5.5% of the committed loan amount as cold storage has a much shorter construction timeline when compared to other product types. Origination fees were allocated to post Certificate of Occupancy financing to further reduce the cash equity needed to close.
Origination Fee: 0.50%
Term: 18 Months Initial Term, One 6-Month Extension
Amortization: Interest Only
Prepayment: Subject to Minimum Interest Estimated at 12 Months
Guaranty: Non-Recourse with Completion Guaranty