Transaction Overview
George Smith Partners arranged the $24,562,500 first mortgage on a value-add, 55+ age-restricted multifamily asset built in 1989. A regional commercial bank provided 65% of the purchase price plus 100% of reposition costs. The LIBOR+225 interest rate (2.50% all-in coupon with a 25 basis point LIBOR floor) requires a rate cap at a 3.25% strike price for the first two years of the term with a required renewal for year three. This structure reduces the overall cap cost to Borrower by shortening the cap’s duration. The three year term is Interest Only for the first 24 months and requires principal and interest payments over a 30 year amortization schedule for the final 12 months of the term. The loan is non-recourse, with carve-out guaranties to a capitalized entity.
