Transaction Overview
George Smith Partners secured $4,075,000 in proceeds for the purchase of a 38-unit multifamily property located near Seattle. Proceeds were maximized by using a 1.20x Debt Coverage Ratio on the actual mortgage constant. The loan has an open prepay after 2 years, an unusual feature for a non-bank loan. In order to maximize underwritten cash flow, the selected lender was able to separate out regular operating expenses from capital expenditures in the historical P&Ls. Final underwritten cash flow allowed for proceeds of about $300,000 higher than the original loan application. Although the Property has tuck under parking, the Lender was able to pre-screen the Property to eliminate the need for earthquake insurance. Fixed at 4.70% for 5 years, the first two years are interest only before rolling into a 30 year amortization schedule for the 20 year term loan.
