Loan Amount: $9,600,000
Term: 18-Months with Extension Options
George Smith Partners has successfully secured $9,600,000 in funding to facilitate the adaptive re-use of a historic downtown office tower into a multifamily/mixed-use project in Pontiac, MI. These funds will be utilized for the development of 103 market-rate multifamily units and over 23,000 square feet of commercial space.
The team at GSP faced challenges over the course of the raise due to limited comparable properties and public data in the Pontiac area. By leveraging our Sponsors’ local relationships and market knowledge, the GSP team effectively packaged and supported the clients’ 80% LTC financing request for the project’s duration. The lending institution exhibited tremendous confidence in the project’s progress and eventual completion. Upon completion, the project is poised to become a benchmark for mixed-use developments in the emerging downtown corridor of Pontiac, Michigan.
President of George Smith Partners
February 22, 2024
George Smith Partners closed a $6,160,000 senior loan for the construction of a luxury single family residence in Northern California. The loan is fixed at a rate of 10.5% for 18 months with full term interest only payments. The Sponsor is the U.S. affiliate of a Brazil-based construction and design company. Because of the Sponsor’s extensive experience constructing and selling luxury homes in the market, the lender was able to get comfortable with the international sponsorship. The lender provided proceeds of 70% of the appraised value of the completed project.
Rate: 10.5% fixed rate, full term interest only
Term: 18 months with one 6 month extension option
Origination fee: 1.5%
- Advisors: Matthew Kirisits
$42,120,000 Stretch Construction Financing for a 188-Unit Build-for-Rent Site in Raleigh/Durham, North Carolina
February 1, 2024
George Smith Partners has successfully arranged a non-recourse stretch senior construction loan of $42,120,000 for the ground-up construction of a 188-unit build-for-rent community in Raleigh/Durham, NC. George Smith Partners, through their expertise in build-for-rent communities and strong relationships with a multitude of lenders was able to negotiate favorable terms for the sponsor including a sizable land lift. The sponsor self-performed most of the site improvements and partnered with a home builder to erect the townhomes on the finished lots in tranches of 15-20 per month. The loan was priced at a floating rate of SOFR plus 475bps with one 6-month extension option. When built, the project will provide the future occupants from the rapidly growing market of Durham a mix of three and four-bedroom townhomes with two-car garages, an amenity center, access to top school districts, and proximity to high income tech jobs.
May 4, 2022
George Smith Partners arranged $3,600,000 in acquisition financing for a 16-unit multifamily property in West Hollywood, CA. The Property came with five vacant units that were previously leased at well below market rents. The Sponsor, a repeat client, planned to renovate the vacant unit interiors and increase rents accordingly. GSP leveraged its network of relationships to source short-term, non-recourse, fixed rate financing with interest only payments with an early rate lock. However, the delayed appraisal report uncovered two units that were not legally permitted, which the lender excluded in its underwriting. GSP worked with the Lender, Appraiser and Sponsor on creative solutions to get as close to the original loan terms as possible. These negotiations required several extensions on the closing. Also, the rate lock eventually expired. Ultimately, GSP was able to get a $3,600,000 loan amount thanks in part to additional analysis and data provided to the Lender. GSP also leveraged its relationship with the Lender to secure a 4.25% fixed rate. While this was higher than the original locked rate, it was well below the current market rate.
Rate: 4.25% Fixed
Term: 2 Years, with 1-Year Extension Option
Prepayment: 1%, 0%
April 20, 2022
George Smith Partners successfully arranged $67,000,000 ($286,324/unit) in non-recourse, construction financing for a 234-unit, mixed-use development in Garden City, ID. This mixed-use development will sit on the edge of the Boise River Greenbelt with stunning views overlooking the water, Boise city and the surrounding mountains. The Project will feature eight retail establishments including a public pub and over 16,000 square feet of open public plaza gathering space. The Project will provide much needed housing to the supply constrained Boise MSA that has seen double digit rent growth in the last few years.
This mid-construction Project had the horizontal construction work completed. GSP was brought in to secure a debt provider to help recapitalize the Project and to see it through completion. With the recent financings in Boise that GSP had worked on, GSP put together a bespoke marketing process. The Project received a tremendous amount of interest from lenders and was put under application in just 7 days! GSP was able to identify a capital partner that provided the best overall value for the Sponsor with competitive pricing, familiarity with the submarket, comfort with the product type, and a closing timeline matching the Sponsor’s needs. The construction loan closed in mid-April providing the necessary financing to bring this Project to fruition. This Project is expected to begin lease up in the second half of 2023.
April 11, 2022
George Smith Partners placed a $47,000,000 senior construction loan for the ground-up development of a mixed-use project in Azusa, CA. When complete, the 5-story project will consist of 127 apartment units and approximately 10,000 SF of 1st-floor commercial/retail/restaurant space. The Project is an integral component in the ongoing expansion of the City of Azusa’s Downtown district and is immediately adjacent to the Gold Line Station, which runs from Azusa Pacific University & Citrus College west to Downtown Los Angeles. This is the Sponsor’s second project in Azusa.
A lack of comparable projects within the submarket posed a challenge. GSP emphasized the supporting employment centers inside a ten-mile radius, including the two colleges and eighteen medical facilities. In addition, a detailed breakdown of the San Gabriel Valley (SGV) submarket helped showcase the presence of a proportionally higher share of younger households than statewide. Data depicting home values that had grown out of reach for those living in a three-mile radius helped the case for a rental project. Further support was provided by the SGV submarket experiencing minor economic impact during the last two years and during Covid.
GSP executed a full-time marketing campaign and identified the most economically beneficial capital stack scenario for the sponsorship with a stepdown in rate at Temporary Certificate of Occupancy (TCO).
Rate: Floating rate (SOFR-based) with rate stepdown at TCO
Term: 36 Months + Two, 12-month Extensions
Stabilized Loan-To-Value: 70%
- Advisors: Matthew Kirisits
$32,000,000 Construction Loan and $9,000,000 LP Equity for the Development of a For-Sale Residential Project; Hayward, CA
April 6, 2022
George Smith Partners placed a $32,000,000 construction loan and $9,000,000 of LP Equity for a for-sale residential project in Hayward, California with a repeat sponsor. This Project will have 55 townhomes providing much needed workforce housing to the area. The Project will also have some affordable units for sale.
GSP was able to combine efforts and execute an effective and in-depth marketing campaign to help the capital markets understand the opportunity appropriately while finding solutions to various challenges that arose during the entire process. GSP marketed and highlighted the Project’s strength, the phasing nature of the build schedule, the projected sales prices and the forecasted upward trajectory in both sales price growth and sales pace growth. GSP was able to source capital providers on the Project that were comfortable with both the depth and experience of the Sponsor as well as believe in the continued growth of the Bay Area.
Ultimately, the professionalism and expertise of GSP on coupled with the proficiency and extensive experience of the sponsor allowed for a successful close.