Transaction Overview
Hotel Refinancing – George Smith Partners placed the $3,840,000 refinance of a 50 unit Holiday Inn Express Hotel in Northern California. The Borrower requested favorable long-term fixed rate financing, but insisted on a flexible prepayment option that would have precluded a CMBS execution. GSP identified a regional portfolio lender with an allocation for hospitality and was comfortable with a structure that included a $600,000 return of equity despite volatility in the debt market. When the lender-ordered appraisal indicated the market value was significantly higher than projected at application, GSP negotiated an additional $140,000 of proceeds above the applied for loan amount. Fixed for 7 years at 4.25%, the loan will float the remaining three years of the ten year term. Prepayment steps down from 5% in year one; there is no lock-out.
