GSPartners
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Volume XV | No. 9 | March 21, 2007
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KEY RATE INDICES
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Prime Rate
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8.25%
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1 Month LIBOR
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5.32%
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5 Yr US Treasury
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4.49%
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5 Yr Swaps
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4.96%
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12-MAT
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5.01%
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3 Month LIBOR
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5.35%
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10 Yr US Treasury
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4.57%
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10 Yr Swaps
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5.10%
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11th Dist COFI
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4.39%
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6 Month LIBOR
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5.34%
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30 Yr US Treasury
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4.74%
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| | | Transaction Description: | | $13,800,000 Non-Recourse Permanent Loan (80% LTPP) and a $2,000,000 Interim Mezzanine Loan (up to 90% LTPP) on a 144,657 Sq. Ft. Grocery-anchored Shopping Center. GSP arranged non-recourse permanent financing plus a short-term mezzanine loan (up to 90% LTPP) to facilitate the acquisition and tenant-in-common equity syndication of this 144,657 sq. ft. grocery-anchored shopping center in Austin, TX. The 1980s-built center is 88% occupied. The lender was willing to provide “one-stop-shop” financing for both the 80% senior loan and the short-term mezzanine loan. Very few lenders offer this type of execution. The mezzanine component is to be paid-off with TIC equity. |
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Permanent Loan:
Rate: 10 Yr T + 1%
Loan Term: 10 yrs
LTC: 80%
Non-recourse
Fees: Par
Prepayment: Defeasance
Mezzanine Loan:
Rate: 1 Mo LIBOR + 3% (initial term), 1 Mo LIBOR + 4.50% (extension term)
Loan Term: 90-day initial term, 90-day extension term
LTC: up to 90%
Fees: 1.75%
Non-recourse
Prepayment: None
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| | | Transaction Description: | | $9,350,000 Construction Loan (93% LTC Actual / 80% LTC Incl. Imputed Equity) for 38-Unit Condominium Development in Phoenix, AZ. GSP arranged financing for the construction of a 38-unit condominium development on an infill site in Phoenix, AZ. The Borrower purchased the land two years ago and entitled it. GSP was able to identify a lender that would value the land at its entitled value and give the Borrower credit for the Borrower’s imputed equity in the land. |
| | Rate: 6 Mo LIBOR + 3% | | Term: 18 mos | | LTC: 93% LTC (Actual) / 80% (Incl. Imputed Equity) | | Recourse | | Lender Fee: 0.75% Lender Origination Fee |
Key Players: Shlomi Ronen, Anna Saucier
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| | | Hot Money | | Nationwide Lender Providing High Leverage Debt for Auto Dealerships and Other Auto-Related Properties. Lender will finance the real state and the franchise value of several auto-related businesses, bringing leverage well above 100% of cost. High performing public or private dealerships considered. First mortgage financing including credit facilities, corporate debt, sale leasebacks. Also, bridge and construction to permanent financing. | | HIGHLIGHTS | | Transaction Size: $5,000,000 + | | Rate: Treasuries or LIBOR based | | Loan Term: Fixed or floating, 5-10 yrs | | Amort: 15-30 yrs | | Max LTC: 150% of real estate cost or more | | Min DCR: Typically 1.50 | | Recourse Negotiable | | Property Types: Anything automotive related | | Prepayment: Lockout period, then step down | | Fees: Typically 1% | | Geography: Nationwide |
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| | | Interest Rate/CMBS Update | Treasuries: The 10 year T is "holding" in the mid-4.50's right now, once again waiting on the Fed during a period of mixed economic reports. The bond market sometimes ignores potential inflationary news and other times negatively reacts on "cooling" news. One thing for sure, the Fed statement and/or action of March 21 will be closely watched; no doubt, trouble in the residential sub-prime market will be on their agenda. CMBS: Now that Swaps and AAA bonds have stabilized (slightly higher than the pre-crisis levels) spreads have also stabilized at 5 bps above their low points.
"Sub-Prime" Woes, How does it affect commercial lending? The residential sub-prime "fallout" may affect certain property types. Multifamily: Positively as some marginally qualifying homebuyers are forced back into the rental market. Office: Negatively as home lenders may cut back on space along with the ancillary businesses (title, escrow, etc). David R. Pascale, Jr. | | | Speakers Corner | GSP Principal/Senior Director Gary M. Tenzer will be participating in the Real Estate 2007 conference on March 27, 2007 at the Los Angeles Convention Center. Gary will moderate the finance panel discussion entitled Today's Capital Markets and Finance Environment: How to Maintain Leverage & Returns through Creative Debt and Equity Structures. Panelists include:
· Jason Choulochas, Regional Director, Wrightwood Capital
· Warren deHaan, Managing Director, Countrywide Commercial Real Estate Finance, Inc.
· Barbara Dugas-Patterson, Senior Vice President & Regional Director, Citibank
· Farrell Ender, Vice President, RAIT Financial Trust
· William Hughes, Managing Director, Marcus & Millichap Capital Corporation
· Tony Jaffee, Managing Director, IXIS Real Estate Capital Inc.
· Lesley Love, Vice President, Regional Manager, Fremont Investment & Loan
· Leslie Lundin, Senior Vice President - National Director of Originations, Inland Mortgage Capital Corporation
| | | | | | Join Us As We Reach New Heights | George Smith Partners is in the midst of a record-setting period of growth. As we continue to reach new heights, we are selectively seeking several seasoned and successful financial professionals to join our team. Please direct confidential inquires to Todd August, Chief Operating Officer, at (310) 557-8336, Ext. 125.
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©2007 George Smith Partners, Inc. FINfacts is an ePublication of
George Smith Partners, Inc. For Promotional Purposes Only. All Rights Reserved.
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