$80,000,000 Non-Recourse Refinance of a Class-A Trophy Asset Office Building in California

Transaction Description: George Smith Partners successfully arranged $80,000,000 in permanent refinancing for a Class A, high-rise, trophy asset office building in a primary market in California. Sized to 32% of appraised value and a 1.78 DCR, the 10 year interest only loan is priced at 2.19% over the 10 year SWAP Rate. The building was situated on an unsubordinated ground lease, which presented challenges. While the property was widely recognized as a trophy asset in the market, the building had low occupancy and above market rents. GSP sourced a capital provider who underwrote the property with an emphasis on gross potential rent as evidenced by Sponsor’s confidence and willingness for occupancy growth with more aggressive pricing of rents. This allowed the lender to get comfortable with the low occupancy along with strong debt coverage on in place cash flow.