Transaction Overview
George Smith Partners secured $6,669,200 in proceeds for the acquisition of two properties comprising 76 units in Portland, OR. The loans are fixed at a rate of 3.30% for 5 years, with 3 years of interest-only payments. The loans are non-recourse and have no payment reserves.
Several challenges were encountered when discussing the transaction with capital providers. Most multifamily loans in Portland are closed through Fannie Mae and Freddie Mac, but these lenders quoted a high rate due to the small size of the market. As a result, GSP had to focus on non-recourse bank lenders, of which there are only a small number active in the market. GSP was able to find a bank with a strong local presence that provided the highest leverage option at a very competitive rate. The pricing was equal to that of multifamily loans in Southern California. The acquisition loan closed in about 60 days.
