Transaction Description:
George Smith Partners arranged a $3,615,000 permanent loan for a 25-unit stabilized apartment complex in Southern California. The Sponsor is a long-term holder and wanted a 30-year loan term. GSP arranged fixed/floating “hybrid” financing with a portfolio lender. The structure offers a 5-year fixed rate period with flexible prepayment (5,4,3,2,1 stepdown) that converts to a floating rate. The Sponsor could then prepay at par or continue floating with adjustments every 6 months capped at 1.0% increases.
Fixed Rate: 5-year CMT + 2.50% Fixed
Term: 30 years with 5 years fixed, then floating
Floating Rate Period: Resets after 5 years TO 30-day SOFR + 2.70%, increases capped at 1% maximum each 6 months
Amortization: 30 years
Prepayment: 5, 4, 3, 2, 1% then Par
LTV: 60%
Assumable: Yes
Origination Fee: Par
Guaranty: Recourse
