Transaction Overview
George Smith Partners arranged a $19,500,000 first mortgage on the acquisition of a value-add multifamily asset located within one of Seattle’s trendiest neighborhoods. The national balance sheet lender provided a non-recourse loan to 70% of total project cost including 100% of future capital expenditure funds to refresh the property’s exterior, interiors including living and common area spaces, and convert 13 furnished extended stay style “executive suites” to market-rate apartments. Interest expense is not incurred on future funding until drawn. Cash flow is maximized as the loan is interest only during the initial three-year term and priced at 4.50% over 30-Day LIBOR. Due to low going-in cash flow, the lender structured an interest reserve to cover debt service during the reposition period.
