GSPartners
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Volume XVIII | No. 8 | February 24, 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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0.22%
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5 Yr US Treasury
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3.09%
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5 Yr Swaps
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2.71%
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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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3.66%
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10 Yr Swaps
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3.83%
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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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4.61%
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| | | Transaction Description: | | High Leverage Acquisition of Two Industrial Condos GSP was retained to help a client acquire two industrial condos in CA. The client had limited cash to put down. Plus he needed to close in a very tight timeframe as the transaction was a court approved REO. GSP arranged 90% LTC financing.
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| | Rate: 5.29% | | Term: 10 | | Amort: 30 | | LTV: 90% | | Lender Fee: Par | | Broker: Shahin Yazdi |
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| | | | Participating Loan Program Funding "Debt/Equity" Transactions Nationwide Some capital sources are looking to book yield by going back to a structure popular in the 1990's, the participating loan. It's debt with an equity component, but without the complex waterfalls and prefs of standard JV equity structure. Plus it is "one stop shop". This lender is targeting Office, Apartments, Industrial, Retail and Self Storage (no land, no construction). High leverage (up to 85% LTV) and loan terms up to 5 years, allow entrepreneurial sponsors time to execute their value added strategies and exit in a more favorable financing environment. Lender receives a "kicker" on exit of approximately 15-20% of the profit. Note that if the exit is a refinance, the property is appraised and lender receives their profit based upon a sale at appraisal price. | | Transaction Size: $10,000,000-$80,000,000 | | Rate: 8-9% minimum | | Loan Term: 3-5 years | | Amort: Interest Only | | Max LTC: 85% | | Property Types: Office, Apartments, Industrial, Retail and Self Storage | | Prepayment: 18 month lockout, then yield maintenance | | Fees: 2% | | Geography: Nationwide, target markets of 1M population |
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| | | Hot Money | Insitutional Equity: 2010 JV Program GSP recently met with an institution providing debt and equity nationwide. The equity program parameters are a good bellweather to understanding the "middle of the fairway" targets for 2010. This institution is looking for Joint Ventures, matching their funds with local developers. They are looking for "Market Recovery, Reposition, and/or Value Added" transactions with 3-7 year hold periods. They are looking to take advantage of the "new basis" post credit crisis. Typical structure is 35% Equity/65% Leverage; with the instituion providing 50 - 85% of the required equity. Preferred returns: 8-12%; Return Targets: Minimum 16% Leveraged 5 year IRR; Transaction Size: $10,000,000-$25,000,000 Equity Contribution; Property Types: Apartments, Industrial, Retail, Office, Mixed Use, Hotel; Geography: Major Markets Nationwide | | | Hot Money | Non Recourse Bridge Lending Is 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); Fees: 1% plus exit fee | | | 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. | | | Speakers Corner | Steve Bram, GSP Principal, will be speaking at the Real Estate Syndication Summit on March 16 at the Luxe Hotel in Brentwood (West Los Angeles). For more information, click here | | | 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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