Transaction Overview
George Smith Partners successfully placed acquisition & recapitalization financing for a four-parcel land assemblage in the Koreatown area of Los Angeles. Our Sponsor will construct a 90-unit multifamily project on the fully entitled site. All four parcels are currently improved with duplexes or four-plexes. Two of the four subject parcels are owned free and clear, and the additional two were under contract for purchase. Market research identified a strong and improving employment and demographic trajectory of the area. Underwriting modeled the land basis in terms of loan per buildable unit. Recent land sale comparables with similar entitlements produced sufficient value for the lender to qualify the value to justify this level of leverage. Sized to 80% of total capitalization, no additional cash equity was required to complete the purchase. Priced at LIBOR plus 300, there is no interest rate floor netting an all-in coupon under 4.0%.
