George Smith Partners successfully placed the distressed recapitalization/discounted payoff on a Class C, 207-unit Atlanta infill apartment community. The loan provided capital to cure deferred maintenance issues in order to return the property to market performance. The 3+1+1 term loan is fixed at 6.50%.
Challenge: The Class C property suffered from low occupancy rates and below market rents in an Atlanta infill location. Capital providers worried about lending to the existing borrower with deferred maintenance in a perceived soft marketplace. The Sponsor required a very quick closing timeframe on the loan.
Solution: GSP explained that the low occupancy and rents were caused by deferred maintenance as a result of cash constraints due to a matured loan. GSP identified a lender comfortable with the Sponsor’s extensive local experience and ability to return the property to market performance, receiving a commitment 32 days after application execution.
