$7,850,000, 10-Year, Interest Only Financing for Two Tractor Supply Stores; Southeast

Rate: 3.80%
Term: 10 years
Amortization: Interest Only
Prepayment: Yield Maintenance with last 6 month open
Recourse: Non-recourse except for bad act and environmental

George Smith Partners successfully placed permanent financing on two Tractor Supply stores in the Southeast. Due to the COVID-19 pandemic, banks required top end recourse and life insurance companies offered lower leverage with a 25-year amortization. GSP secured a capital provider that offered 10 years interest only with nominal reserves. They appreciated the strong tenant financials and sales at each location despite prevailing local economic conditions. On the day of closing, the Capital Provider tightened the spread 7 basis points because the market tightened.

Advisors

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    Transaction Description:

    George Smith Partners successfully placed $14,050,000 in construction financing, which funded 89% of total project cost, for the acquisition and reposition of a 79-unit, mixed-use property in a desirable and historic St. Louis City neighborhood. GSP was engaged by the Borrower when its original lender, a national REIT, was forced to re-trade the Borrower on loan terms due to the COVID-19 pandemic. Upon being engaged, GSP was able to source the replacement debt and equity in time to close the transaction without a material delay. The financing structure included a senior loan to 81% loan-to-cost and a preferred equity investment with last-dollar exposure to 89% of total project cost with a 4.90% blended cost of capital. GSP leveraged its expertise of the St. Louis market, long-standing lender relationships, and capital markets creativity to achieve the Borrower’s goals of minimizing cash equity invested into the Project so that it can keep a substantial cash reserve to pursue additional projects which are expected to present themselves during the COVID-19 pandemic.

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    Transaction Description:

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    Transaction Description:

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  • Expand

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