Multifamily

George Smith Partners arranged the acquisition and renovation debt for a Koreatown 50-unit multifamily asset. Fully occupied at funding, our Sponsors confirmed that existing rents are sustainably underperforming the market and will initiate a plan to renovate units and re-stabilize the subject. The cash flow in place (4.8% debt yield) constrained a majority of the capital markets to 50% of purchase. Mr. Yazdi identified a regional capital provider who underwrote proforma rents at market and structured three years of interest only before rolling into a 30 year amortization schedule. A small reserve of $230,000 is held until a 1.25 DCR is obtained. Proceeds for the renovation are exclusively Sponsor controlled and discretionary. This acquisition funded 40 days from application. Floating at Prime plus 0.75%, the loan carries a 4.50% floor. There is no prepayment penalty or exit fee.