$4,780,000 (94% of Cost/No New Cash) - FINfacts

KEY RATE INDICES

FANNIE MAE RATES *

Prime Rate	5.0%
11th District	3.974%
3 Mo. T’s (YTM)	1.82%
6 Mo. T’s (YTM)	1.81%

5 Yr. U.S. T’s	3.62%
10 Yr. US T’s	4.30%
30 Yr. US T’s	4.88%
12-MAT	4.088%

LIBOR - 1 mo.	2.09%
LIBOR - 3 mo.	2.02%
LIBOR - 6 mo.	1.97%
LIBOR - 1 yr.	2.12%

Tier 2+ (80% LTV)	6.02%
Tier 3+ (65% LTV)	5.84%
Tier 4+ (55% LTV)	5.64%
10 yr. term/30 yr. amort.

TRANSACTION OF THE WEEK !

$4,780,000 (94% of Cost/No "New Cash" Required) Construction Financing for 45 Unit Apartment Complex in Northridge: This is the 3rd financing arranged by GSP for this borrower on the same street. The borrower purchased two adjoining 1960's vintage complexes last year (two different lenders, Fannie Mae and a local bank). The second property included a vacant lot next to the complex. GSP was able to arrange financing with no additional equity because the parcel's land value has tripled in value since the purchase last year. The same bank provided the construction financing. They recognized the imputed equity in their underwriting. The new two story Mediterranean style complex will feature 45 two bedroom units (averaging 1,100 sf.) and two levels of subterranean parking. Five of the units are configured as 2-story townhouses with interior staircases. All units will include washer/dryer, microwave, modern kitchens and balconies. Terms: (1) Rate: Prime + 0.75% (7.50% floor); (2) Term: 18 months/Interest Only; (3) Lender Fee: 0.75%; (4) Recourse; (5) Mini-perm option: Subject to 1.20 DCR, 6 month LIBOR + 2.25%, 5/30, 0.50% lender fee. (Steve Bram, David R. Pascale, Jr., John Lopez)

$1,700,000 Floating Rate Loan on Self Storage Facility with an Option to Convert to Fixed Rate: This refinance of a recent purchase helped the borrower recover recent costs for renovation. Originally constructed in 1979, this 451 unit facility was upgraded, resulting in 95% occupancy, higher rents as leases expire, and a higher NOI. Upgrades included additional custom storage bins (including containers), re-asphalting, landscaping, color change, repainting of entire property, signage upgrading and extensive lighting retrofit to fluorescents which will save 50-60% on electricity. The facility consists of 15 single-story reinforced concrete block buildings, 62 modified containers and 14 RV spaces. The lender did underwrite the container income on this storage facility located in Riverside. Terms: (1) Rate: 30 day LIBOR + 3.10% Floor: 6.90%; (2) LTV: 75%; (3) DCR: 1.23; (4) Term: 36 months/Interest Only with a 1 yr extension option for 0.5% fee payable upon exercising the extension 10/30; (5) Convertible to 5 yr fixed rate; (6) Non-Recourse, (7) 1 year lockout from prepayment, (8) Lender Fee: 0.5% (Mike Gottlieb)

INTEREST RATE / CMBS UPDATE

The 10 year treasury closed the week at 4.30% after hitting a low of 4.15% on Wednesday. The Fed's statement that accompanied the 0.5% rate cut on Tuesday indicated they are open to a further cut at the December meeting. The treasury surprised the market with last week's announcement that they will not be issuing any more 30 year bonds. This week, the government funded itself with an interim sale of 10 year treasuries. Note that this issue actually has a 9 ¾ year term, so there is no new "on the run" 10 year treasury. The increase in supply helped raise yields late this week. However, recent economic reports indicated little threat of inflation, fueling speculation of further rate cuts. CMBS: Three new fixed rate pools have priced in the past few weeks, the first issues since September 11. The 10 year AAA's priced at Swaps + 60-64. (Pre Sept 11, 10 year AAA's priced at Swaps + 45-50, so the widening from the terrorist events turned out to be 15-20 bps). Trading was active, with the bid-ask narrowing to 1-2 bps in many cases. Also, the CMBS "curve" (the spread differential between upper and lower tranches) narrowed slightly for these new issues. With Swap spreads themselves tightening (10 year Swap has fallen from 67 to 59 in the last two weeks) and continued low treasury yields, watch for originators to become more flexible on floor rates… Stay tuned (David R. Pascale, Jr.)

The 7th Annual GSP Real Estate Luncheon was an absolute success. We would like to thank the 1,700 attendees who made it such an incredible event. A special thank you goes to our Keynote Speaker, Angelo Mozilo.

For those of you who did not attend, you may have heard our "auctioneer," Steve Soboroff, requested all attendees to donate their neckties to Becca's Chic Boutique by leaving them at their tables. Result: Becca's Chic Boutique is pleased to announce that several hundred high quality, designer ties are now on sale at unbelievable prices.

You can visit the store at 19822 Ventura Blvd. in Woodland Hills (between Corbin and Winnetka), 818-703-0151.

* GSP is an L.A. correspondent for ARCS Commercial Mortgage, the nation's largest FNMA/DUS originator.

Note: Lender pricing and loan points are subject to change and exclude GSP loan placement fees.