George Smith Partners successfully placed the 72% LTC bridge loan for the acquisition and reposition of a Los Angeles based grocery anchored shopping center. The interest-only coupon floats at 250 bps over LIBOR and is currently under 3.0%.
Challenge: Although the property is 100% occupied, the grocery anchor that represents 89% of the gross leasable area will vacate in four months at their lease maturity. The property also has a legacy environmental issue from a former dry cleaning plant.
Solution: GSP identified a capital provider comfortable with the Sponsor’s expertise and the property’s leasing potential as demonstrated with letters of intent for 41% of the space to be vacated. GSP worked with the lender to structure reserves containing objective criteria for releasing the funds at various project stages. The new Sponsor confirmed an abatement plan to resolve the environmental issue and obtained closure from the local governmental agency.
