GSPartners
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Volume XVI | No. 32 | October 29, 2008
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KEY RATE INDICES
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Prime Rate
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4.50%
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1 Month LIBOR
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3.12%
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5 Yr US Treasury
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2.71%
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5 Yr Swaps
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3.78%
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12-MAT
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2.48%
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3 Month LIBOR
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3.42%
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10 Yr US Treasury
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3.85%
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10 Yr Swaps
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4.34%
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11th Dist COFI
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2.69%
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6 Month LIBOR
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3.94%
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30 Yr US Treasury
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4.19%
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| | | Transaction Description: | | $10,312,500 Fixed Bridge Loan for the Acquisition and Reposition of a Retail/Office Building in Beverly Hills. GSP secured bridge financing for an 18,000 sq. ft., 3-storey retail and office building in Beverly Hills. The building’s excellent location has always afforded it full occupancy, but it has not been renovated to include modern amenities and rents are well below market. The sponsor plans to significantly upgrade the common area spaces, to include handicap access, new flooring, lighting and wall finishes, as well as installing a state-of-the-art elevator. The exterior of the building will also be resurfaced. Following the renovations, the building will command nearly double the rents that tenants are now paying. |
Challenge:
• Low DCR: In place DCR at closing was 0.60 – substantially below breakeven.
• Seismic Concerns: Lender was reluctant to lend on a brick building that was built in 1924.
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Solution:
• Low DCR: GSP demonstrated that the borrower had sufficient recurring cash flow from other properties to debt service this loan and was able to negotiate no holdbacks for interest reserve.
• Seismic Concerns: GSP persuaded lender to underwrite based on land value and worked with the appraiser to help establish the land value. No third party seismic assessments were necessary.
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| | Rate: 6.2% fixed | | Term: 3 yrs | | Amort: Interest Only | | LTV: 71% of land value | | LTC: 75% of purchase price | | DCR: 0.60 in place | | Prepayment: Open | | Recourse | | Lender Fee: .75% | Holdbacks: None
Assumable
Deposits of at least $400,000 required
Lender held to all original terms and closed two weeks ahead of schedule.
Key Players: Farz Emrani,
Anna Saucier |
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| | | Middle Eastern Fund Purchasing Properties and Notes Middle Eastern Fund looking to make all cash (no debt) purchases of properties or notes, $50,000,000 minimum, needs 8% unleveraged stabilized return, long term hold acceptable. Prefers office, retail or apts. Will do rented condo projects. No hotels because alcohol cannot be served. Wants to place $500,000,000 by year end.
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| | | GSP is a Fannie Mae/Freddie Mac Correspondent | In these turbulent times, George Smith Partners reminds our clients that we have been a Fannie Mae/Freddie Mac correspondent with PNC/ARCS ("ARCS") for many years, giving you access to one of the Nation’s top Fannie Mae/Freddie Mac seller servicers. And these Fannie/Freddie “agency lenders” are continuing to aggressively make apartment loans. By submitting loans through us, you will receive the best agency pricing along with GSP’s outstanding service at no additional cost. So if you are planning to refinance your existing mortgage or acquire an apartment building, we are here to help you with your financing needs. We look forward to working with you.
| | | GSP Lender Services and Note Sales Update | GSP is actively marketing a growing inventory of defaulted California loans from various banks and lending sources. The current inventory includes loans secured by Southern California land in various stages of development. Some premier locations include beachfront and infill mixed use. Please call us to register and obtain our inventory list. Please contact Craig Hamilton (ext. 136), Max Friedman (ext. 128) or David Rifkind (ext. 124).
| | | GSP Private Briefing Series | David Rifkind, GSP Principal/Managing Director, along with Gary M. Tenzer, GSP Principal/Senior Director, is presenting a Private Briefing Series to Ezra Brutzkus Gubner LLP on Wednesday, October 29, 2008. This program is designed to inform at a high level and address the State of the US Commercial Real Estate Capital Markets as seen from an industry insider. This presentation is geared toward industry professionals whose practice is in Commercial Real Estate, Law, Accounting or Government. This program is qualified for MCLE credits. If you are interested in having Mr. Rifkind, Mr. Tenzer and their team present to your firm, please contact Stella Debibi at 310-557-8336 Ext. 103 or sdebibi@gspartners.com.
| | | Speakers Corner | Steve Bram, GSP Principal/Senior Director, will be a guest speaker for a Real Estate Development class at UCLA Extension on the evening of Wednesday, November 5. He will discuss "Financing the Deal in a Difficult Market."
| | | In the Press | | | | Come Grow With Us | George Smith Partners is expanding its team of top-notch mortgage brokers – originators and assistants. We offer highly competitive compensation and an excellent environment in which to work, learn and be supported. GSP provides its employees with cutting edge market information, resources for identifying the best capital sources for each transaction, training opportunities and peer support whenever it is needed.
We invite you to consider a career with George Smith Partners. Please direct confidential inquiries to Stella Debibi, Director of Business Development and Recruitment, at (310) 557-8336, Ext. 103.
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©2008 George Smith Partners, Inc. FINfacts is an ePublication of
George Smith Partners, Inc. For Promotional Purposes Only. All Rights Reserved.
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