Don't Miss a Fact,
Sign Up for FINfacts!

FINfacts is a weekly newsletter highlighting recent financings and economic insights.

Subscribe Here

$8,400,000 Bridge Loan for Big Box Retail Center in Tertiary Market

Rate: L+425
Term: 3 Years + Two, 1-Year Extensions
Amortization: Interest Only
LTC: 75% LTC
Prepayment: 18 Months Yield Maintenance
Lender Origination Fee: 1.0%
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners secured $8,400,000 of bridge financing for the lease-up of a two-tenant retail center located in Greeley, CO. The Sponsor recently leased a 50,000 square foot space to a national fitness center. The new 10-year lease, which has a corporate guaranty, required a large tenant improvement package. Loan proceeds will be used to refinance the existing loan and fund leasing costs without requiring the Sponsor to bring in any additional equity. The other tenant at the center, a national specialty retailer, agreed to extend their lease term to 10 years concurrently, eliminating any rollover risk. GSP found a capital source that understood that the tenants are uniquely positioned to serve the market, allowing the Lender to get comfortable with the completed value of the center. The non-recourse financing was sized to 75% LTC and priced at One Month LIBOR + 4.25%.

Advisors

Related Financings

  • $4,760,000 Acquisition Bridge Financing for Vacant Retail/Restaurant Building; Los Angeles, CA

    August 16, 2023

    Transaction Description:

    George Smith Partners secured a $4,760,000 acquisition loan for a vacant 12,300 square foot retail property in Los Angeles, CA. The Lender provided proceeds of 70% of the acquisition price at a rate of 7.325%, fixed for the first three years. The loan was closed with a regional bank.

    The Property was delivered as a vacant shell. The buyer intends to lease it to restaurant and retail tenants. Given the current market volatility, most of the other quotes were from private money lenders at much higher rates. To support the purchase price and future valuation, an extensive set of sales and lease comps were provided to the lender and the appraiser. The Borrower’s track record of success with similar properties demonstrated their ability to execute their business plan.

    Rate: Fixed for 3 Years at 7.325%, then Floating
    Term: 5 Years
    Amortization: 1 Year Interest Only followed by 25-Year Amortization
    Prepay: 3, 2, 1, 0%
    LTV: 70%
    DCR: 1.25x at Stabilization

  • Bridge Financing for Two Retail Properties; Hollywood, CA

    August 31, 2022

    Transaction Description:

    George Smith Partners successfully placed a $3,245,000 bridge loan fixed at 5.00% for two years. The loan will have an initial funding of $2,400,000 with the remainder distributed in 6 months’ time to accommodate funding structures for the Borrower’s needs. The Collateral is two adjacent commercial properties located in Hollywood, CA. One building is completely vacant and the other is a dated laundromat. The proceeds will cover renovation and leasing costs allowing the vacant building to stabilize, then provide additional proceeds to re-tenant the laundromat once the other building is cash flowing. The initial term sheet was structured at Prime plus a spread of 0.50%. When interest rates spiked during the closing process, GSP negotiated a fixed rate of 5.00%. GSP sourced a lender able to provide cash-out financing, limited recourse that burns off at full stabilization and fix their interest rate for the life of the loan.

    Rate: 5.00% Fixed
    Term: 2 Years
    Amortization: Interest Only
    LTV: 55%
    Prepayment: Open
    Guaranty: 50% – Burns off at DCR Hurdle
    Lender Fee: 0.50%

  • $4,030,000 Non-Recourse Bridge Acquisition Financing for 44% Occupied Retail Center; Tempe, AZ

    September 29, 2021

    Transaction Description:

    George Smith Partners secured $4,030,000 of bridge financing for the acquisition of retail shop space in Tempe, AZ. The collateral encompassed approximately 30,000 sf of in-line retail space and an outparcel pad within a larger anchored retail center. At purchase, the collateral was only 44% occupied. The Sponsors believe that a new leasing strategy will be able to drive tenants to the Center. The Property is located on one of the corners of a major intersection that sees over 65,000 cars per day and is less than two miles from Arizona State University, one of the largest universities in the country. The capital provider structured the financing to have a holdback for future property improvements, leasing costs, and interest payments. Priced at 30-Day LIBOR + 7.00%, the non-recourse loan was sized to 68% of total cost and carries a two-year term with extensions. The Lender was also able to include partial releases if only a portion of the collateral is sold.

    Rate: L + 7.00% (0.25% LIBOR Floor)
    Term: 2 Years with Two 6-Month Extensions
    Loan-to-Cost: 68% LTC
    Amortization: Interest Only During Initial Term
    Guaranty: Non-Recourse with Standard Carveouts

  • $25,500,000 Bridge Financing for a 42k SF Landmark Retail Asset; Koreatown, Los Angeles

    August 4, 2021

    Transaction Description:

    George Smith Partners successfully secured $25,500,000 in non-recourse bridge financing for a destination dining and retail center nestled in the heart of Los Angeles’ Koreatown. The 42,000 square foot property is one of Koreatown’s most trafficked retail centers and maintained stable collections throughout 2020. The recapitalization retired the existing debt and provided future funding for capital expenditures, tenant improvements and leasing expenses with no new equity required from the Sponsor.

    The Los Angeles-based sponsorship team acquired the Property in 2016, identifying the asset as a generational heirloom and a unique opportunity to create substantial value. Despite market volatility and COVID-19 related challenges in the retail sector, GSP was able to identify a lender with local knowledge and expertise that understood the importance of this asset within the context of the neighborhood, and the long-term viability of the business model.

     

    All Terms Confidential

  • Retail Acquisition Financing with Less Than 100% Collection Rate; Los Angeles, CA

    June 23, 2021

    Transaction Description:

    George Smith Partners successfully arranged bridge acquisition financing for a 6-unit retail property in Los Angeles, California. The Subject Property took a major hit with rent collections during the Covid-19 pandemic and was operating below market conditions. GSP identified a capital provider who was able to offer an aggressive rate and terms, required no holdbacks of any sort, required no deposits to be held at their branch and provided an open prepayment penalty structure that allowed the Sponsor flexibility once the Subject Property is stabilized and seasoned.

    Rate: 3.75%
    Term: 7 years
    Amortization: 25 years
    LTV: 50%
    Prepayment Penalty: None
    Minimum Interest Payments: None
    Guaranty: Full recourse
    Banking Relationship/Deposits Required: None

  • $45,600,000 Non-Recourse Bridge Financing for Recapitalization of Lido Marina Village in Newport Beach, CA

    April 21, 2021

    Transaction Description:

    George Smith Partners structured and arranged $45,600,000 in bridge financing for the recapitalization of the Lido Marina Village, a 116,000 sf multi-block, waterfront boutique retail and office property on Balboa Peninsula in Newport Beach. Lido Marina Village features retail, restaurant, and office space in 14 separate structures including prime waterfront retail and restaurant spaces featuring spectacular harbor views, along with 47 boat slips, creating an iconic Newport Beach destination. Some highlighted restaurants include Orange County’s only Nobu and Malibu Farm locations. Retail tenants include first-to-market “laid back luxe” retailers such as Elysse Walker, LoveShackFancy, Serena & Lily, the RealReal, and Jenni Kayne. The Property stretches from the waterfront, across a public street and walkway to the Via Lido street-front retail. It also includes a 372-space parking structure and 91 on-grade parking spaces. The Project is located on 17 legal parcels totaling 3.5 acres, with 4 parcels held as leasehold interests. Since the acquisition in 2013, the Sponsor successfully rebranded Lido Marketplace as a super high-quality boutique and restaurant destination, featuring a “who’s who” of tenants. Even during the pandemic, Lido Marina Village occupancy stayed high, and the Sponsor signed new leases at “high street” rents. The Property has been thriving in part due to their shoppers feeling comfortable in the open air, pedestrian friendly and waterfront environment.

    Rate: Confidential
    Term: 2 years with two 1-year extensions
    Amortization: Interest Only
    Guaranty: Non-Recourse