Transaction Overview
GSP successfully placed the $4,400,000 non-recourse loan on a 20,403 square foot multi-tenant office building in West Los Angeles. The loan provided a return of equity on the Class B asset on a non-recourse basis. The 10-year term amortizes over 30 years after the 3rd year of interest only.
Challenge:Maximizing the return of equity and ongoing cash flow to the sponsor is best achieved through a CMBS execution. The loan request was below the $5,000,000 minimum threshold for most Wall Street capital providers. The collateral consists of numerous non-credit tenants with relatively short leases and high rollover. The subject is located on a secondary street.
Solution:Our strong lender relationships allowed us to achieve large deal terms on a small, sub-$5,000,000 transaction. Despite being below the lending institution’s minimum loan size threshold, the deal was closed by an investment bank with aggressive pricing. The strength of the Sponsor added to the appeal of the transaction and mitigated excessive roll-over structuring and the secondary location.
