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$7,986,000 First Mortgage, 65% LTV, 2.9%, 10 Yr., Full Term I/O; West Los Angeles, CA

Rate: 2.9% Fixed
Term: 10 Years, Interest Only
LTV: 65%
Prepayment: Yield Maintenance
Lender Fee: .5%

Transaction Description:

George Smith Partners secured a $7,986,000 first mortgage at 65% LTV for a 23-unit multifamily property in West Los Angeles, CA. The loan is non-recourse and supplies significant cash-out proceeds, a low 2.9% 10-year fixed rate, and full-term interest-only payments. The financing replaced a bridge loan that was put in place to acquire the Property and complete significant upgrades including unit renovations, common area and exterior improvements, and conversion to solar power.

GSP started working on the refinancing in the Spring of 2020 at the height of the COVID-19 quarantine, while the property was still being renovated and released. GSP was able to persuade the Lender to underwrite income on a trailing one month basis rather than a trailing six month basis. This allowed the underwriter to include the higher income from the newly leased units. The loan application process began when the property was approximately 75% leased. The lender agreed to a forward rate lock at 85% occupancy and closed when the building reached 95% occupancy.


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    Transaction Description:

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    Amortization: Interest Only
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    Max “As-Complete” LTV: 60%
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    Transaction Description:
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  • $8,750,000 Bridge Refinance with Cash-Out for 35-Unit Multifamily Property; San Jose, CA

    January 13, 2021

    Transaction Description:

    George Smith Partners secured $8,750,000 in total financing comprised of a 60% LTV first mortgage and a 10% LTV second mortgage for a 35-unit multifamily property in San Jose, CA. The loans provided significant cash-out proceeds at a blended rate of 7.41%. Both loans have a 12-month term, interest-only payments and are open to prepayment without penalty. Recourse is limited to 50% of the second mortgage only. The Property has maintained full occupancy and rent collections despite the COVID-related impacts in the overall market. The Lender did not require reserves for potential COVID rental interruption. The Sponsor developed the Property in the 1980s and engaged GSP to provide a high leverage, quick-close financing solution. The financings closed within 8-days of the Lender’s issuance of term sheets.

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    Transaction Description:

    George Smith Partners placed 5 non-crossed loans totaling $13,770,000 to complete the refinance of a 67-unit multifamily portfolio in Los Angeles. The financing represents a significant return of equity to the Sponsorship while simultaneously lowering their previous interest rate. The loans all carry a fixed interest rate of 3.35%, a 5-Year term, and include interest only payments ranging between three and five years. In contrast to many lenders that are currently structuring six to twelve months of P&I reserves, GSP successfully negotiated waiving any shortfall structure.

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    Transaction Description:

    George Smith Partners placed a $6,275,000 bridge loan for the refinance of a Class-B 132-unit apartment community in San Antonio, TX. The loan is fixed at 6.45% for three years with full term interest-only payments. The term sheet was signed after the COVID-19 crisis and ensuing economic volatility. GSP identified a balance sheet lender with in-house loan servicing to work with the Sponsor throughout the reposition of the asset. The Property underwent a change in property management in the past few years and required some property maintenance in the reposition. GSP worked with the Client on the original acquisition bridge loan and had to re-evaluate the business plan once the market changed and occupancy dipped due to COVID-19.


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    Amortization: Full Term Interest-Only
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    Transaction Description:

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    Reserve Account: None
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