80% Loan to Cost, Non-Recourse Acquisition Bridge Financing for a 20 Unit Multifamily Property in South Los Angeles; Closed in 30 Days with No Lender Legal

Rate: 7.25%
Term: 3 Years
Amortization: Interest only
LTC: 80%, including future funding
Guaranty: Non Recourse
Lender Fee: 1% in / no exit fee
Prepayment Penalty: 12 month interest guarantee

George Smith Partners arranged $2,300,000 in non-recourse acquisition bridge financing for a value-add multifamily property in the South Los Angeles. The 20 unit, 1920’s vintage property had significant deferred maintenance and below market rents. The Sponsor’s business plan was to reposition the property, buyout tenants and release the units at market rents. The transaction carried a very short 30 day closing time frame.

Sized to 80% of total project cost, the loan includes future funding for tenant buyouts, a full gut renovation of unit interiors and an exterior upgrade. The three year bridge loan is interest only and carries a fixed interest rate of 7.25%. Interest is not charged on the hold-back until funds are drawn. The lender fee was limited to a 1% origination fee with no exit fee. The lender did not charge a legal fee and closed the transaction in 30 days from term sheet execution.

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