Transaction Overview
Bryan Shaffer and Jon Shapiro placed a singular loan covering a three-property portfolio of newly renovated, working class apartment projects in Suburban Atlanta. The Sponsor purchased these assets out of foreclosure prior to performing extensive renovations and leasing the units up to market occupancy. The new financing offered a return of equity to the Borrowers’ original capitalization. Fixed at 4.13% for 20 years, amortized over 30 years, the non-recourse loan is priced comparable to 10 year term financing.
Challenge: The recently stabilized buildings have little seasoning. The Sponsor requested longer than traditional term fixed rate with a 30 year amortization period to maintain loan proceeds. Georgia Multifamily property values have not kept up with the national market appreciation.
Solution: GSP demonstrated the upward income trends at all three properties, improvements in the Atlanta housing market, the Sponsors’ operating plan and prior market success. GSP identified a national capital provider with the flexibility of structuring a 20 year fixed term that would not self-liquidate, allowing for longer amortization to maintain debt coverage and maximize proceeds.
