GSPartners
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Volume XVIII | No. 20 | May 13, 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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0.34%
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5 Yr US Treasury
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2.27%
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5 Yr Swaps
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2.56%
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12-MAT
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0.41%
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3 Month LIBOR
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0.43%
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10 Yr US Treasury
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3.55%
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10 Yr Swaps
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3.61%
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11th Dist COFI
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1.86%
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6 Month LIBOR
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0.62%
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30 Yr US Treasury
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4.46%
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| | | Transaction Description: | | $28,700,000 (75% LTC) Construction Financing for 50,000 sf Medical Facility for UCLA in Santa Monica, California GSP secured senior financing for construction of a three-story 50,000 sf outpatient surgery facility that is 100% leased to the University of California Los Angeles. The facility, slated to open in 2011, features special improvements for imaging and radiation services, a robotic parking garage, and LEED Gold certification. It is located at Wilshire Blvd & 16th St, across the street from the main entrance to the recently expanded Santa Monica-UCLA Medical Center |
Challenge: At the time GSP finalized the terms of the loan in December 2009, (permits delayed closing until now), construction financing was broadly unavailable.
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Solution: GSP initially studied the project and interviewed decision makers at key institutions to surface issues without publicizing the project. Then we initiated negotiations for debt from portfolio lenders (life companies and pension funds), and the bond markets (based on UCLA’s long-term credit lease). As the credit markets loosened in Q3 and Q4 2009, we recommended that the sponsor negotiate with his existing investors to enhance the credit of the available loan guarantee, and then expanded the search to include a number of stronger banks. Ultimately the developer had multiple attractive and well-qualified financing options, and chose a bank loan with recourse |
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| | | | Credit Lines for Buyers of Single Family Homes -- Trustee Sales or Bank Owned Attention Distressed "Bulk" SFR Buyers and Sellers! Check out this innovative, reasonably priced, customized lending program. The structure is a revolving line of credit with lender secured by 1st Trust Deeds on the homes. There is no prepayment penalty upon sale, providing borrower with maximum execution efficiency. Lender will fund up to 60% of purchase price of the homes. Borrower accesses the line by working directly with Loan Committee. California properties only. | | Transaction Size: $1,000,000 to $10,000,000 | | Rate: 8.9% | | Amort: Interest Only | | Property Types: Single Family Homes |
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| | | Hot Money | Multifamily Program Features 3 years of Interest Only at 5.40% or 5 years of Interest only at 5.75% Total loan term is 30 years with an interest only period of 3-5 years. Loan then converts to a 30 year amortization and floats at 12MAT + 2.55-2.70%. Loan features declining prepayment during the interest only period and then is prepayable at par. George Smith Partners is a correspondent to this lender and receives wholesale pricing with no fee to the lender. Lender underwrites to a 1.15-1.20 DCR on the start rate with a 30 year amortization. Max LTV's are 75% for purchase and 70% for refinances (65% for cash out refinances). Lender is usually recourse. For example on 5 year IO program: Lender Net Operating Income = $200,000; Underwrite at 1.15 Debt Coverage on 30 Year Amortization; Underwriting Rate is Start Rate = 5.75%; Estimated Loan Proceeds = $2,480,000; Monthly Payment = -$14,492 Transaction Size: $750,000-$5,000,000; Rate: Start rate for 3-5 years @ 5.40% to 5.75%; Loan Term: 30 years; Amort: 30 years; Max LTV: 75%; Max LTC: 75%; Min DCR: 1.15 on 30 year amortized constant; Recourse: Yes; Property Types: Apartments; Prepayment: 1.5,1.5,1.5,1.0,1.0, then None; Fees: Par; Geography: California | | | Hot Money | Institutional Bridge Money Lender Sees Opportunity in Core Markets This nationwide lender is funding bridge loans ($10,000,000 and up). GSP met with the top executives of the group today in our office. Takeaway quote: "The market recovery is moving faster than we anticipated" Lender is looking to fund transitional properties in core markets for good sponsors. Property type focus is on apartments, grocery anchored retail, selective office and hotels (limited and full service). Lender will fund below break even and most aggressively on apartments, while hotels will size at an approximately 12.5% debt yield. Maximum loan to total cost is 70-75%. Lender will consider future fundings with no neg arb. Transaction Size: $10,000,000 and up; Rate: LIBOR + 4-5%, 1% floor on LIBOR; Loan Term: 3-5 years; Amort: Interest only; Max LTV: 75%; Max LTC: 75%; Min DCR: 1.0 for most properties; Non-recourse; Property Types: Apartments, Grocery Anchored Retail, Office (some), Hotels; Fees: 1% plus 1% exit fee; Geography: Nationwide | | | CMBS Lenders Feeling Their Way Back (Blog by Steven Orchard) | We are gathering quotes and in application on a number of CMBS loans, and today met with the national head of CMBS lending for a major money center bank. We, like the lenders, are learning how CMBS 2.0 is going to work.....Click here to read entire post | | | 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. Last week our membership surged to over 1,200 members. Click here to 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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