Rate: 3.66% Fixed
Term: 10 Years
Amortization: Five Years Interest Only; 30 Years Thereafter
Loan-to-Value: 65%
DCR: 1.25
Recourse: Carve-Outs Only
Prepayment: Loss of Yield
Loan Fee: 0.425%
Transaction Description:
George Smith Partners placed the $43,281,000 non-recourse cash-out permanent loan for 360 stabilized units in a secondary California market. This represented a substantial return on equity. Loan proceeds were increased post application as the supportable underwritten net cash flow improved during the due diligence process. Occupancy constantly operated at 98% with future increases forecasted at unit turn. Fixed for ten years at 3.66%, the non-recourse loan is interest-only for five years prior to amortizing over 30 years for the balance of the term.
Related Financings
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Perm Debt – 1.20x DSCR & 3-Years Interest Only – Stabilized Multifamily, Los Angeles, CA
April 7, 2021
Transaction Description:
George Smith Partners secured senior permanent financing for a stabilized multifamily property located in the Pico Robertson neighborhood of Los Angeles, CA. The non-recourse debt was utilized to complete the acquisition of the multifamily asset. The loan was structured with a 5-year term and interest only payments for the initial 3-years followed by a 30-year amortization schedule. The loan was collateralized by a Class B, three story, 16-Unit multifamily property. The Subject was 100% leased at closing but only 78% physically occupied.
GSP selected a bank lender that was able to underwrite the income from three newly executed leases with no seasoning. The Lender funded the full proceeds with signed leases and rent checks although the tenants had yet to take possession. The Lender executed on excellent terms while closing on a firm acquisition deadline of 45 days. At application, the Lender offered an early rate lock to remove any pricing risk. GSP worked with the Lender to navigate the appraisal assumptions surrounding concessions and market rent stemming from various COVID risks while maximizing proceeds.
Rate: 3.40%
Term: 5 years
Max LTV: 65%
Min DCR: 1.20x
Amortization: 3-Years Interest Only, 30-Year Schedule thereafter.
Origination Fee: Par
Prepayment: 3, 1, 1, 1
Guaranty: Non-Recourse- Advisors: Matthew Kirisits
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$4,100,000 Non-Recourse Cash-Out Refinance, 14-Unit Multifamily Property; West Los Angeles, CA
October 23, 2019
Transaction Description:
George Smith Partners successfully secured a $4,100,000 non-recourse permanent refinance of a 14-unit, multifamily property in West Los Angeles. Loan proceeds were used to pay off the existing variable, higher interest rate bridge loan into a lower interest, fixed rate loan. There was significant cash-out to the Sponsor, who had recently completed an extensive reposition and upgrade of the Property. Due to the Sponsor’s business plan, flexibility and interest only were paramount. As such, GSP worked with the Lender to structure a 5-year fixed rate term with 3 years interest only and a step-down prepayment structure of 3%, 2%, 1%. This structure allows the Sponsor to maximize current cash flow while providing the flexibility of a step-down structure that burns off when the loan begins to amortize.
Rate: 4.20%
Term: 30 years; 5 years fixed then converts to floating rate at Libor + 2.25%
Amortization: 3 Years Interest Only then 30 year amortization
LTV: 65%
Minimum DSCR: 1.20x
Guaranty: Non-Recourse
Prepayment: Stepdown, 3%, 2%, 1%, open
