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| Volume IX, No. 7 |
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March 2, 2001 |
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| KEY RATE INDICES |
FANNIE MAE RATES * |
| Prime Rate |
8.50% |
| 11th District |
5.514% |
| 3 Mo. T’s (YTM) |
4.83%
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| 6 Mo. T’s (YTM) |
4.68% |
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| 5 Yr. U.S. T’s |
4.71% |
| 10 Yr. US T’s |
4.94% |
| 30 Yr. US T’s |
5.37% |
| 12-MAT |
6.108% |
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| LIBOR - 1 mo. |
5.29% |
| LIBOR - 3 mo. |
5.08% |
| LIBOR - 6 mo. |
4.97% |
| LIBOR - 1 yr. |
4.93% |
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| Tier 2+ (80% LTV) |
6.85% |
| Tier 3+ (65% LTV) |
6.70% |
| Tier 4+ (55% LTV) |
6.50% |
| 10 yr. term/30 yr. amort. |
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TRANSACTION OF THE WEEK!!!
$21,000,000 Fixed-Rate Bridge Financing (1.0 DCR, 30-Day Close) for Two Class A Office Buildings in San Fernando Valley: The two buildings total 176,000 s.f. and are well located in upscale, low vacancy submarkets. Property Specs: Sherman Oaks: Built in 1985; 93,000 s.f., 4-story, dramatically landscaped atrium, 36 tenants, 99% occupied. Woodland Hills: Built in 1989 (renovated in 1998); 83,000 s.f.; 3-story; 2 landscaped courtyards including fountains; 27 tenants; 85% occupied. The borrower purchased the properties 3 years ago, completed a capital improvement program, increased rents and occupancy and now is preparing to sell the properties. GSP arranged a full leverage, short term fixed rate loan with no lockout, prepayment or exit fees. The properties were cross-collateralized with partial releases at 110% of par. Transaction was completed in 30 days from application to funding. No appraisal was required. Terms: (1) Rate: 10.25% fixed; (2) Loan Term: 12 months with a 6-month extension option; (3) Interest only; (4) LTV: 76%; (5) DCR: 1.0; (6) Non-recourse with carve-outs to the borrowing entity, no "warm body"; (7) Lender Fee: 1.5%. (Andrew Levant) |
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| $13,050,000, 7.65% Acquisition Permanent Loan on 100,000 SF Grocery Anchored Shopping Center in Northern California: In this reapplication "quick close" acquisition scenario, the new CMBS lender was very accommodating and able to close in 30 days by using the existing 3rd parties. This 100% occupied, 22 tenant, neighborhood center was rehabbed in the mid-90's and purchased from an institutional owner. Unique Feature: Lender locked rate at the full loan amount, and funded the loan based upon future cash flow with a $1.3 million Letter of Credit in place. The LC will be released upon the grocery store and BankAmerica rental increases within the next few months. The property is extremely well located in a strong sub-market and has virtually no competition in its trade area, which ultimately got the lender very comfortable. Factors that helped the lender mitigate risk: (1) The grocery store (38,000 s.f.) is a division of the largest privately held supermarket chain in the country; (2) One of the top stores in a very strong regional office supply chain, (3) Strong financial statement and operating track record of borrower Terms: (1) Pricing: T + 245; (2) Term/Amort: 10/30; (3) LTV: 80%; (4) DCR: 1.34; (5) Non-recourse; (6) Lender Fee: Par; (7) Release of Letter of Credit is contingent on rental increases taking place. (Michael T. Gottlieb, Gary E. Mozer) |
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| $3,760,000 (7.40% Fixed) Permanent for 84-Unit Apartment Complex in Koreatown Another example of a borrower taking advantage of today's excellent refinance climate. GSP arranged "full boat" financing at a sub 7½% rate. This early 1970's garden style apartment complex is all 1 & 2 bedroom units and features a pool, spa, gym, saunas, and two koi ponds. There is covered parking and various security features. The borrower purchased the under performing property approximately 5 years ago, implemented a rehab program and re-leased it at rents that are 5% above market. Today, the property is 100% occupied. The financing enabled the borrower to pull out $1.4 million of equity that they used to acquire another under-performing apartment project in Las Vegas. Terms: (1) Rate: 7.40%; (2) LTV: 80%; (3) DCR: 1.20; (4) Term/Amort: 10/30; (5) Non-recourse; (6) Lender Fee: par (Andy Levant) |
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HOT MONEY!
2nd Mortgages to $2MM (Southern California only): Savings bank w/ 10-year 2nd mortgage money and attractive pricing options as follows: (1) Amount: $500,000 to $2MM w/ a max. combined 1st & 2nd of $3.8MM; (2) Property Type: Most types of income property; (3) Interest Rate: Fixed @ 11.5%+ -or- adjustable @ Prime + 2%, 6-month LIBOR + 4.5% or 1-year T's @ 5%; (4) Origination Fee: 2 pts.; (5) LTV: 70% combined; (6) DCR: 1.25:1; (7) Amortization: 25 years; (8) Term: Up to 10 years; (9) Prepayment: Open to prepay w/o penalty; (10) Other: Will do small 2nd's behind large 1st. Will do 2nd's behind adjustable rate 1st mortgages.
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| * 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. |
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