GSPartners
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Volume XVIII | No. 6 | February 11, 2010
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KEY RATE INDICES
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Prime Rate
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3.25%
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1 Month LIBOR
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0.23%
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5 Yr US Treasury
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2.37%
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5 Yr Swaps
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2.60%
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12-MAT
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0.46%
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3 Month LIBOR
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0.25%
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10 Yr US Treasury
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3.69%
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10 Yr Swaps
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3.68%
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11th Dist COFI
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1.828%
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6 Month LIBOR
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0.39%
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30 Yr US Treasury
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4.64%
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| | | Transaction Description: | | Senior Loan on HOA Ground Lease Buy-Out for Condos on Catalina Island GSP secured financing for a Homeowner’s Association to acquire the existing ground-lease underlying the entire condominium complex, and thereby achieve fee simple ownership for the unit owners
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Challenge: Title: A number of city requirements and encumbrances on title obstructed and delayed closing; Equity: The HOA board could not assure how many residents would post equity until immediately prior to close; Prepayment: The HOA needed to allow individual owners flexibility to pay-off their pro-rata portion of the loan at any time; Guaranty: The HOA was unable to provide personal repayment guarantees.
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Solution: Title: Lender was willing to hold loan terms for 6 months while the requirements were satisfied and title was cleared; Equity: Lender agreed to finance the balance of closing costs up to 100% with final loan amount set at closing; Prepayment: Lender allowed partial pre-payment without penalty at any time, and agreed to adjust the amortization schedule to reflect the adjusted principal balance, and thereby commensurately reduce debt service for remaining borrowers; Guaranty: Lender accepted a guaranty from the HOA entity, and collateralized the loan against HOA dues.
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| | | | Non Recourse Bridge Lending Coming Back Attention opportunistic reposition buyers, this program is for you. Nationwide fund will lend on transitioning assets including fractured condos (that underwrite as apartments). Will structure future fundings depending on asset and business plan. Lender will fund interest reserve and carry. This is discretionary fund money, not a CDO or securitization based. | | Transaction Size: $10,000,000-$50,000,000 | | Rate: 7.5-9.5% | | Loan Term: 3-5 years | | Min DCR: 10% Debt Yield (Stabilized) | | Non-recourse | | Fees: 1% plus exit fee | | Geography: Nationwide |
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| | | Hot Money | Bank Mini-Perm Program This well capitalized institution is concentrating on "old fashioned" mini-perms, not construction or bridge. Bank is looking for relationships, repeat borrowers. This program is ideal for borrowers with cash flowing properties, looking for a good rate and flexibility. Loan Size: $3,000,000 - $15,000,000; Loan Term: 3-7 years, will do 5+5; Rates: 6.00% range, fixed or floating; Debt Yield: 10%; DCR: 1.30; "Some" recourse required. California only. | | | Hot Money | CMBS 2.0 Summary CMBS bond buyers are lining up for new issue bonds. Why? Because they can't get their risk adjusted yields elsewhere in the marketplace. CMBS 2.0 will feature "back to basics" underwriting at the "new basis" and therefore is differentiated from legacy CMBS. Originators are taking credit risk and will take down transactions on their balance sheets. Look for smaller and simpler pools as originators will try to go to market quickly. Rates are "about 6.75%" for 10 year terms (as low as 5% for low leverage). Transaction Size: $5,000,000 and up Rate: 6.75-7.25% Loan Term: 5 or 10 years Amort: 30 years; Max LTV: 75%; Debt Yield: 10%; Non-recourse; Fees: 0.5% - 1.0% Geography: Major markets; UPDATE: Mezz is available, leverage up to 8% Debt Yield, Mezz Rate: 12-15% | | | If you have an inquiry regarding George Smith Partners' commercial real estate financing, asset sales or advisory services please contact your GSP representative or Todd August, Chief Operating Officer, at (310) 867-2995 or taugust@gspartners.com. | | | Join Us on LinkedIn | George Smith Partners is now on LinkedIn.....Come on and join the George Smith Partners group to get access to current conversations and topics. | | | Come Grow With Us | George Smith Partners is expanding its team of top-notch mortgage brokers/originators. 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 Todd August, Chief Operating Officer, at (310) 867-2995. |
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©2010 George Smith Partners, Inc. DRE # 00822654 FINfacts is an ePublication of
George Smith Partners, Inc. For Promotional Purposes Only. All Rights Reserved.
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