GSP successfully placed the cash-out loan refinance of a local restaurant to 65% of value. The investment property is leased to a local operator who does not credit enhance the lease. The new loan retired existing debt, paid off unrelated and unsecured payables and provided a substantive cash cushion to the sponsor.
Challenge:The single tenant is considered special use with only this one location. The Sponsor has historic credit issues with limited liquidity.
Solution: The lender became comfortable with the tenant by demonstrating the long term stability and historical operations of the restaurant. The business has been at this location for 20+ years and sales have recently been on the rise. GSP structured all invoices paid through escrow. The Borrower initiated a depository relationship with the local capital provider.
