Transaction Overview
GSP successfully placed the acquisition debt on a 1990’s vintage, 161-unit multifamily property in a tertiary Montana market. The $13,100,000 non-recourse senior note represented 85% of the initial purchase price. The three year term loan floats at LIBOR plus 6.0% on an interest only basis.
Challenge: Sponsor required high leverage non-recourse debt on collateral located in a thinly populated market with a high concentration of college students.
Solution: GSP stressed the high 98% occupancy of the competitive set. Coupled with limited planned supply and the property occupancy at 100% for the past three years, the lender became comfortable with the depth of sustainable demand.
