Transaction Overview
Hotel Financing – George Smith Partners placed $3,710,000 financing on a 79-unit limited service hotel in the Southwestern United States. Constructed in 2010 by our Sponsor, all loan proceeds were used to refinance the existing debt and cover closing costs. GSP identified a lender who was comfortable with the borrower’s strength and understood the economics of the transaction. During underwriting, the appraisal came in at a value more conservative than expected. Our capital source agreed to advance a short term commercial loan of $200,000 at Prime plus 1.25%, self-amortized over 5 years to avoid the need for additional cash equity infusion from our Sponsor. Fixed for 5 years at 5.25%, the senior loan floats for two years at Prime plus 1.25% for the seven-year term.
