GSP/Rifkind Brings Harmony Back to Harmony

There have been rumors swirling regarding my health because I have been out of the office for nearly five months. One of the problems with longevity is that the wheels start coming off and you need capital improvements. In my case, I had a rare form of bone marrow cancer which is now in remission. The side effects from the chemo cocktail knocked me for a loop. This was followed by kidney failure with a treatment of dialysis three days per week. I have started working from home and will return to the office in the next week or two. I have no intention of retiring because my work is my passion along with my search for Ataxia Telangiectasia treatments. I look forward to hosting the 2005 A-T Executive Luncheon Series and hope that many of you will consider signing up soon because you are running out of time. Finally, David Stepanchak and I are in the final stages of arranging a $235 million high-rise condominium construction loan that we have been working on for nearly one year. More details will follow in a future FinFax.

GSP/Rifkind Brings Harmony Back to “Harmony”
or- George Smith Partners Brings the “George” Back to “Georgetown”

GSP/Rifkind Funds a $17,500,000 “Cooperative Work-Out” Solution for a 1600 Home Land Development in Georgetown, South Carolina: After several years of start-and-stop activity due to an institutional lender that had internal problems, the developers of “Harmony,” a luxury, waterfront home and lot development near Myrtle Beach, SC, are back on track. Their existing lender is operating in voluntary receivership and cannot fund the additional dollars to “tip” the project. GSP/Rifkind engineered a cooperative solution that paid the existing lender down substantially while freeing up an additional $11,000,000 to fund the balance of the infrastructure, land development and marketing program for the project. The major challenge was that the lender is out of compliance with various regulatory agencies and cannot accept a loss to principal or carry subordinated financing. The solution was a creative redistribution of collateral with an innovative release mechanism that, in addition to a substantial initial pay-down, will take the lender out completely after the first ¼ of the lots are sold. GSP/Rifkind was initially engaged to bring equity to fund a pre-negotiated work-out plan. “After flying out to view the project and gain a depth of understanding, we realized that there was a far better solution for all parties that would ensure the success of the project,” said David Rifkind. “GSP/Rifkind was able to accomplish this solution with debt allowing the sponsors to retain 100% of the ownership and upside benefit”. Term: 5 Years, Interest-Only. (Mike Gottlieb, David Rifkind, Henry Bryan)

(Use GSP/Rifkind’s quick-close capability to create value in your transaction. For more info, contact David Rifkind (ext. 130, drifkind@gspartners.com)

Gary M. Tenzer, GSP’s Executive Vice President and co-founding Principal, was recently featured in a cover story in both the “Los Angeles and San Francisco Daily Journal”, a publication for the California legal community. The Journal article presents a detailed profile of Mr. Tenzer and his extensive experience testifying as an expert witness and as a litigation support consultant in over 100 real estate related litigation and bankruptcy matters. The article profiles a number of cases in which Mr. Tenzer has been involved and how he has brought his 26 years of real estate financing expertise to add credibility and authority to the cases in which he has testified. (To read the full story, click here.)

Nationwide Lender Rolls Out Very Agressive Fixed Rate, Non-Recourse, Interest Only Drug Store Financing Program!
There is limited capital for this program- first come, first served. This is the best program we have seen for Walgreens, Eckerd and/or CVS..

Walgreens and CVS Corp:

• 85% of acquisition price
• 5, 7 or 10 year loan terms, no amortization (interest only payments for the entire term)
• Minimum 1.20x debt service coverage based on the interest only payment
• $0.15 psf in cap-ex reserves unless roof and structure covered by Walgreens/CVS
• No TI/LC reserves
• Loan psf cannot exceed $350
• Store sales should be in excess of $300 psf and not downward trending (replacement store sales will be acceptable on case by case basis)
• At least 18 years remaining on initial lease term

Eckerd:

• 80% of acquisition price
• 5, 7 or 10 year loan terms, no amortization (interest only payments for the entire term)
• Minimum 1.20x debt service coverage based on the interest only payment
• $0.15 psf in cap-ex reserves
• No TI/LC reserves
• Loan psf cannot exceed $300
• Store sales should be in excess of $300 psf and not downward trending (replacement store sales will be acceptable on case by case basis)
• At least 18 years left on initial lease term
  

GSP Welcomes Aaron Wright: (Part of our continuing series profiling GSP's "Next Generation" of Brokers) Mr. Wright joined GSP full-time in December 2004 after receiving his Bachelor’s Degree in Business Administration with an Emphasis in Real Estate Finance from USC’s Marshall School of Business. Prior to GSP, Aaron worked for a residential mortgage banking firm performing a range of duties including accounting, due diligence and loan origination. Aaron Wright can be reached at ext. 136 or awright@gspartners.com.

Gary Mozer will be on the “Mezzanine Financing in Today’s Marketplace” panel at the Crittenden National Conference 2005 in San Diego on April 20th. For more information, please go to www.CrittendenNational.com.

Luncheon I – April 27th
“Economic Big Picture for 2005 and Beyond”
ROSS DEVOL (Milken Institute)
For more information, log on to www.gspartners.com/at.