New Program for SFR Land Loans - FINfacts

KEY RATE INDICES

FANNIE MAE RATES *

Prime Rate	8.25%
3 Mo. T's (YTM)	4.93%
6 Mo. T's (YTM)	5.07%

5 Yr. U.S. T's	4.54%
10 Yr. US T's	4.57%
30 Yr. US T's	4.58%
12- MAT	4.88%

LIBOR - 1 mo.	5.35%
LIBOR - 3 mo.	5.36%
LIBOR - 6 mo.	5.35%
LIBOR - 1 yr.	5.21%

Tier 2++ (80% LTV)	5.72%
Tier 3++ (65% LTV)	5.58%
Tier 4++ (55% LTV)	5.44%
10yr. term/30 yr. amort.

TRANSACTION OF THE WEEK!

$36,000,000 Financing Package Including Permanent and Mezzanine Debt for a 320 Unit Multifamily Acquisition in Temecula, CA. GSP arranged highly structured financing which included a $30,500,000 fixed rate permanent loan and a $5,500,000 fixed rate mezzanine loan for a 320 unit apartment acquisition in Southern California. The borrower acquired the subject property with an anticipated three to five year hold and intends to raise rents to market through aggressive management and the elimination of operational inefficiencies to reduce expenses. They also anticipate significant annual market growth as the region continues to see an enormous influx of residents. While this strategy and anticipated three year holding period would have typically utilized a LIBOR based bridge loan, since the property had some cash flow, GSP was able to secure fixed rate conduit financing and substantially lower rates with five years interest only and a flexible prepayment option. Permanent Debt Terms: (1) Rate: 5 Yr T +1.05%; all in rate of 5.65%; (2) Term: 5 yrs; (3) Amort: Interest Only; (4) LTV: 80%; (5) Non-Recourse; (6)Prepayment: Locked out for 2 yrs, defeasance thereafter with last 3 mos open to prepay at par. Borrower also had the option to have the last 12 mos open to prepay at par for an increase of 0.10% in interest rate; (7) DCR: 1.10 (in place, Interest Only); (8) Lender Fee: Par. Mezz Debt Terms: (1) Rate: Fixed at 11%; (2) Term: 5 yrs; (3) Amort: Interest Only; (4) LTC: 85%; (5) Non-Recourse; (6) Prepayment: Locked out for 2 yrs, thereafter prepayable in whole but not in part; (7) Lender Fee: 2%. (Steve Bram, Steven Yazdani)

$11,080,000 Non-Recourse, Acquisition Financing at 80% of Cost (Acquisition + PIP) for Limited Service Hotel. GSP arranged long term, fixed-rate financing to acquire a flagged limited service hotel located in a tertiary California Market. The asset was built in October 2004 and has preformed at the top of the market since inception. As a result of cap rate compression, our clients are finding significant value in the limited service hotel industry. The borrower purchased this asset at a 10.76% cap rate. While this is a strong performing asset, lenders looked closely at the continuing construction of limited service hotels in this market. Lenders also had very limited operating history to assure long term stability of the asset since construction was completed in late 2004. The borrower intends to improve management, operations and marketing, thus improving occupancy and net cash flow. Terms: (1) Rate: 10 Yr T + 1.19%; (2) Term: 10 yrs; (3) Amort: 30 yrs; (4) LTV: 80%; (5) DCR: 1.50; (7) Non-Recourse; (8) Prepayment Penalty: Yield Maintenance; (9) Lender Fee: Par. (David Stepanchak, Allison Higgins)

HOT MONEY

New Program for SFR Land Loans. In certain regions of the US, landholders are waiting for the market to come back and need to buy some time. This nationwide lender is rolling out a new program as other lenders may be pulling back. Lender will consider unentitled land or partially entitled assemblages. Program Highlights: (1) Transaction Size: $20,000,000 and up; (2) Rate: LIBOR based, best available per transaction; (3) Loan Term: 2-3 yrs; (4) Amort: Interest Only; (5) Max LTV: 75%; (6) Usually Non-Recourse; (7) Fees: Specific to transaction; (8) Geography: Nationwide.

INTEREST RATE/CMBS UPDATE!

Fixed rates are up. The 10 Year T is at 4.57% as multiple economic reports, including robust retail sales and shrinking business inventories (such as an unexpected drop in fuel inventories right before winter), indicate potential inflation. As expected, the Fed kept rates unchanged yesterday; Prime closes out the year at 8.25%. LIBOR still at its recent high of 5.35%. Stay tuned… (David R. Pascale, Jr.)

GSP PROFILES
(Part of our continuing series profiling GSP's "Next Generation" of Brokers)

Bryan Berkett, Associate: Mr. Berkett joined GSP in late 2006. He previously worked as an analyst at Ascent Real Estate Advisors. He is the founder of a number of entrepreneurial ventures, including an international microfinance bank. He has a Bachelor of Arts degree from Columbia University and is currently completing his MBA at UCLA Anderson School of Management.

Ryan Reese, Analyst: Mr. Reese joined George Smith Partners in 2006 upon graduation from the University of Southern California, where he earned his Bachelor of Science degree in Business Administration.

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