Rate: 4.5% Fixed for 5 years
Term: 5 years
Amortization: 2 Years Interest Only/ Then 30-year amortization
Prepayment Penalty: None
Guaranty: Recourse
Lender Origination Fees: 1/4 Point
Transaction Description:
George Smith Partners secured $38,500,000 for the recourse, cash-out refinance of a 950-unit multifamily building located just outside of Cleveland, Ohio. The waterfront building is situated in one of the best suburbs. The Sponsor purchased the building about 12 months ago with large vacancies and completely renovated and rehabbed the Property.
Challenges:
With the successful renovation plan making progress, the Property was leased from 30% to just above 70% occupancy. Most lenders require 90% occupancy for 90 days to qualify for long-term fixed-rate financing. The Property’s current bridge loan had a floating rate that was increasing as both short-term and long-term rates increased in today’s challenging environment.
Solution:
With GSP’s help, the Sponsor utilized a detailed lease-up business plan which allowed the Lender to understand the strength of the asset, location, and experience of the Sponsor. GSP originated a permanent loan for this 72% leased property and the Lender was able to underwrite to in-place income and allow for low-cost, 5-year financing at a below market rate with no prepayment penalty.
Related Financings
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Cash-Out Refinance of a 16-Unit Multifamily Property; 3.1% Fixed; 70% LTV; Los Angeles, CA
May 18, 2022
Transaction Description:
George Smith Partners arranged permanent financing for a 16-unit multifamily property located in Los Angeles, CA. The loan is fixed at a rate of 3.1% for 5 years and has 3 years of interest-only payments. The deal went into application several months ago when interest rates were 100 basis points lower. Because of GSP’s strong relationship with the Lender, the original terms were held in an increasing rate environment. The financing does not require any deposit relationship with the bank.
Rate: 3.10%
Term: 10 Years, Fixed for first 5 Years
Amortization: 3 years Interest-Only
LTV: 70%
Prepayment: 3, 2, 1, 1, 1% -
$2,083,000 Cash-Out Refinance of a 44 Unit-Multifamily Property; Dallas-Fort Worth, TX
April 20, 2022
Transaction Description:
George Smith Partners secured a $2,083,000 agency loan for the cash-out refinance of a stabilized 44-unit multifamily property located in Dallas-Fort Worth, TX. GSP used its relationship with a capital provider whom we had closed multiple loans with. This lender recently closed a similar loan in this market. They understood the market and felt comfortable with the market characteristics. The Sponsor recently completed exterior and interior renovations including common area upgrades. The recent improvements allowed the Sponsor to increase rents thus increasing the value of the Property. GSP was able to provide the Sponsor with a 7-year term and a flexible prepayment structure equal to 5%, 5%, 4%, 4%, 3%, 2%, 1%. The loan structure allows the Sponsor to refinance out of an expensive loan with a fixed rate of 3.38%, while also receiving cash out. The Sponsor is using cash-out proceeds to continue their business plan of purchasing and renovating additional properties. Thanks to our long-standing relationship with this Lender, GSP was able to meet the Sponsors deadline and close this transaction within 60 days from signing the term sheet.
Rate: 3.38%
Term: 7 Years
LTV: 65%
Amortization: 30 Years
Prepayment: 5%, 5%, 4%, 4%, 3%, 2%, 1% -
$15,100,000 Cash-Out Refinance of a 5-Property Multifamily Portfolio at 3.40% – 70% LTV; Los Angeles, CA
April 11, 2022
Transaction Description:
George Smith Partners arranged $15,100,000 in permanent financing for the refinance of a 5-property multifamily portfolio located in Los Angeles, CA. Using GSP’s vast network of relationships, we were able to source and quickly lock fixed rate financing in a market that is seeing rising interest rates. The Sponsor also wanted to pull cash out of their existing multifamily portfolio to use as equity towards purchasing new properties. The Sponsor had recently completed exterior and interior renovations including common area upgrades to all five properties. The recent improvements allowed the Sponsor to increase rents thus increasing the value of the Property. GSP was able to provide the Sponsor with a 30-year term, with the first 5 years being fixed at a rate of 3.40%. The loan represents 70% loan to value with a minimum 1.20 DSCR. The flexible stepdown prepayment structure is equal to 5,4,3,2,1. The cash-out loan allows the Sponsor to use more equity towards growing their multifamily portfolio. Thanks to GSP’s long-standing relationship with this bank lender, we were able to meet the Sponsors deadline and close this transaction within 35 days from signing the term sheet.
Rate: 3.40%
Term: 30 years term, fixed for first 5 years
LTV: 60%
DCR: 1.20 -
4,450,000 Cash Out Refinance Loan For 37-Unit Multifamily Property in Los Angeles, CA; 7 Years Fixed at 3.40%; 5 Years Interest Only Payments
April 6, 2022
Transaction Description:
George Smith Partners arranged $4,450,000 in financing for the refinance of a stabilized 37-unit mixed use property located in Los Angeles, California. The loan is fixed at a rate of 3.40% for 7 years. The new financing is a takeout of the acquisition loan that GSP closed five years earlier. Over the course of their ownership, the Sponsor performed a renovation of the Property and substantially increased the net operating income. As a result, the new loan provided a significant return of equity. The Lender held the rate of 3.40% even though interest rates increased while the loan was in application. Full credit was given for the income from two ground floor retail tenants. The loan has 5 years of interest-only payments.
Rate: Fixed at 3.40% for 7 years
Term: 7 years
Amortization: 5 Years Interest Only
Prepayment Penalty: 5,4,3,2,1%
Guaranty: Non-Recourse- Advisors: Matthew Kirisits
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$14,000,000 Cash-Out Refinance of a 4-Property Multifamily Portfolio at 3.15%,70% LTV; Los Angeles, CA
November 10, 2021
Transaction Description:
George Smith Partners arranged $14,000,000 in cash-out permanent financing,70% LTV for the refinance of a 4-property multifamily portfolio located in Los Angeles, CA. Due to GSP’s vast activity, we were able to time the loans to match up with a special discount program offered by a regional lender. GSP structured the portfolio to maximize the cash-out to the Sponsor at the lowest possible cost. With over $3,000,000 in cash out, the Sponsor still lowered their monthly debt service. GSP was able to arrange a 30-year term with the first 5 years fixed at a rate of 3.15%. The rate will then reset every 5 years for the remainder of the term. The flexible prepayment structure is equal to 1.75% for the first 3 years, 1% for years 4 and 5, and 0% thereafter. The cash-out financing provides the Sponsor with equity allowing them to continue to grow their multifamily portfolio. GSP was able to meet the Sponsor’s deadline and close this transaction within 40 days from signing the term sheet.
Rate: 3.15%
Term: 30 years term, fixed for first 5 years, resets every 5 years after for the term.
LTV: 70%
DCR: 1.15 -
Cash-Out 2.94%, $12,025,000 Non-Recourse Permanent Refinance on a 100% Leased Discount-Grocer Anchored Shopping Center; Western States
August 4, 2021
Transaction Description:
George Smith Partners successfully placed $12,025,000 in non-recourse, cash-out permanent refinancing for a 101,096 square foot discount-grocer anchored retail shopping center in a transitory Pacific Southwest MSA. The tenant mix includes several national credit tenants along with local and regional stores, all of which remained in-place during COVID-19. GSP was able to identify a lender who understood the complexities of retail in a post COVID environment. The non-recourse permanent loan was sized to 65% of value, included 10-years of interest only payments at a fixed rate of 2.94% for 10 years. Lender fee is at par.
Rate: 2.94%, Fixed
Term: 10 years
Amortization: Full-Term Interest Only
LTV: 65%
Lender Fee: Par
Prepayment: Defeasance
Guaranty: Non-recourse
