Transaction Overview
George Smith Partners was approached to obtain high leveraged quick purchase financing. The Sponsor had the opportunity to purchase a quadruplex well below market value because of his ability to close quickly with an 80% LTC quick-close loan. GSP arranged this non-recourse acquisition financing. The Property is currently 100% occupied. Rents are below market due to the need for exterior and interior improvements. The loan was structured with a first trust deed from a debt fund as well as a preferred equity B piece. There’s additional flexibility for the Sponsor because there is no prepayment penalty. This loan structure allows the Sponsor to implement their business plan of renovating units, increasing rents, and refinancing into a permanent loan within a few months. The non-recourse facility was priced at an interest only fixed rate with a blended rate of 9.14% with a 12-month term plus a 6-month extension. Thanks to our long-standing relationship with this debt fund and preferred equity investor, GSP was able to close this transaction in less than 5 days from signing the term sheet.
