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| KEY RATE INDICES |
FANNIE MAE RATES * |
| Prime Rate |
4.50% |
| CODI* |
1.162% |
| 3 Mo. T’s (YTM) |
1.65%
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| 6 Mo. T’s (YTM) |
1.86% |
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| 5 Yr. U.S. T’s |
3.39% |
| 10 Yr. US T’s |
4.18% |
| 30 Yr. US T’s |
4.97% |
| 12-MAT |
1.522% |
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| LIBOR - 1 mo. |
1.76% |
| LIBOR - 3 mo. |
1.87% |
| LIBOR - 6 mo. |
2.07% |
| LIBOR - 1 yr. |
2.36% |
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| Tier 2+ (80% LTV) |
5.32% |
| Tier 3+ (65% LTV) |
5.25% |
| Tier 4+ (55% LTV) |
5.04% |
| 10 yr. term/30 yr. amort. |
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TRANSACTION OF THE WEEK
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$15,970,000 Senior Debt and Equity for Acquisition of 5 Acre Parcel, To-Be-Built 95-105 Unit Condominium Project in Orange County: GSP arranged senior debt and 90% of the equity for this "land" acquisition. The property now contains 64 units of cottage style 1960's vintage apartments. Business plan: Acquire property and construct approximately 100, 2-3 story condominium units with shared amenities (pool, etc). The location is infill residential with excellent freeway access. The senior debt provided by the bank is at 60% of the initial project costs - leverage was constrained as the initial funding is considered a land loan. The senior lender has pre-approved an 85% loan-to-cost construction loan when all condo entitlements are in place. The total project cost is estimated at $39,000,000. GSP also arranged the 90% of required equity contribution with a national opportunity fund. Special Features: (1) Financing was arranged prior to city approval for the development; (2) Borrower is acting as developer, general contractor and sales agent for the condos. The equity fund and the lender are recognizing construction management fees and sales brokerage fees as part of the total capital structure. Senior Debt Terms: (1) Rate: 30 Day LIBOR + 2.75%; (2) Term/Amort: 12 months/Interest Only; (3) LTC: 60% on acquisition (85% upon construction); (4) Recourse; (5) Lender Fee: 0.75%. Equity Terms: Confidential. (Steve Bram, Shlomi Ronen)
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| $7,080,000 Refinance for 38,000 s.f. Mixed Use Property at a Major Ski Resort: This 3 building office/retail/multifamily redevelopment project is located in a well known resort area of the Western US. Buildings 1 and 2 are masonry buildings that were converted to office & retail uses with retail on the ground floor and office above. Building 3 is new construction consisting of 24 studio apartment units (approx 300 s.f. each) on top of ground floor retail. All 3 buildings are 2-story. Residential is 100% occupied and commercial space is 77% leased to locally based retail and office tenants netting an 81% overall occupancy. The asset was purchased three years ago and has been undergoing redevelopment/repositioning since acquisition. GSP arranged permanent financing with an initial funding of $5,800,000 with an option to earn out an additional $1,200,000 in two fundings during the next 24 months. Terms: (1) Rate: 5 year T + 1.65%; (2) Term: 5 years; (3) Amort: Interest only for 1 year then 27 year amort; (4) LTV: 75%; (5) DCR: 1.25; (6) Lender Fee: Par; (7) Non-recourse. (Steve Bram, Shlomi Ronen, David R. Pascale, Jr.) |
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| $1,060,000 Floating Rate Acquisition Loan (start rate 4.13%, capped at 7.50%) on 9-Unit Hollywood Apartment Building: GSP arranged this aggressively priced loan to help reinvest the buyer's 1031 proceeds and diversify holdings. The interest rate resets every six month at 2.75% over 12-MTA (trailing 12 month average of 1-year U.S. treasuries), and is capped at 7.50% in years 1-10, and at 9.50% in years 10-30. Terms: (1) Pricing: 12 MAT + 2.75%; (2) Term/Amort: 30/30, no negative amort; (3) LTV: 55%; (4) Prepayment: Open in year 4 and for the rest of the loan term, reduced if refinanced with the same lender; (5) Recourse; (6) Lender Fee: Par. (Steven Orchard, Larry Wilemon) |
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SPEAKER'S CORNER
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CREW-Los Angeles' 20th Anniversary Gala: George Smith has been selected as the Anniversary Honoree for CREW's 20th Anniversary Gala on Saturday, November 6, 2004 at the Ritz Carlton in Marina Del Rey. CREW is a national networking organization with 5,700 members representing nearly every discipline found within the commercial real estate industry. CREW is the premier national organization dedicated to advancing the success of women in commercial real estate. CREW's significance is reflected by the fact that: (1) Women control 50% of all commercial real estate activities worldwide, (2) 50% of all real estate firm CEOs are women, (3) 50% of private real estate developers and owners are women and (4) 50% of presidents of major lending and banking companies are women. Mr. Smith was chosen in recognition of his leadership role in the real estate community balanced by his educational and charitable activities for more than 35 years. For more information contact Minda Johnson at (310) 888-6461/minda.johnstone@cnb.com or www.crewnetwork.org.
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| USC Marshall School of Business: Shlomi Ronen, will guest lecture at the USC Marshall School of Business on September 13th. He will be discussing the current status of the real estate capital markets. Focus will be on the unprecedented breadth of capital sources, interest rate trends and financing alternatives available to developers and investors. |
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GSP's NEXT GENERATION OF BROKERS
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As part of our continuing series profiling GSP's "Next Generation" of Brokers…
GSP Welcomes Steven Orchard: Mr. Orchard joined GSP as an intern in March 2003, while completing an MBA at UCLA's Anderson School of Management. He joined GSP full time in April 2004. Prior to GSP, Steve was a founding member of a (still surviving) software firm providing transaction and document management tools for public and private entities in the real estate industry. His undergraduate education was completed at the University of Southern California. Steve's wife, Karrie, is a real estate professional and UCLA Law graduate. Steven Orchard can be reached at ext 209 or sorchard@gspartners.com.
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10th Annual GSP Real Estate Luncheon
(To Benefit the A-T Medical Research Foundation)
SAVE THE DATE!
Wednesday,November 17, 2004
| The 10th Annual GSP Real Estate Luncheon to benefit the A-T Medical Research Foundation will be held on Wed., November 17th at the Century Plaza Hotel. |
FEATURED GUEST SPEAKER
John E. Anderson
President & Sole Shareholder, Topa Equities, Ltd.
Registration materials will be available soon...
MARK YOUR CALENDARS NOW!!
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