GSPartners
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Volume XVIII | No. 36 | September 29, 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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0.26%
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5 Yr US Treasury
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1.27%
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5 Yr Swaps
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1.45%
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12-MAT
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1.75%
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3 Month LIBOR
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0.29%
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10 Yr US Treasury
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2.49%
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10 Yr Swaps
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2.52%
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11th Dist COFI
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0.35%
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6 Month LIBOR
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0.46%
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30 Yr US Treasury
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3.67%
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| | Headline | | | | | Transaction Description: | | $7,750,000 Bridge Loan (66% LTC, 6.75% Interest Rate, Non-Recourse) on a Multi-Family Property in Atlanta, Georgia.
GSP arranged financing for a quick-close trustee sale acquisition of a 95% occupied 300-unit apartment community.
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Challenge: The transaction required GSP to secure committed financing to back the client’s bid at a trustee-sale; The outcome of the bid process remained uncertain during due diligence. The client agreed to close all cash, but required debt to fund within 24 hours of the initial acquisition. GSP was engaged 45 days prior to the trustee sale. In addition, the Atlanta multifamily market is broadly characterized by most capital providers as struggling.
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Solution: GSP identified a lender that agreed to close less than four weeks after execution of their term sheet. GSP worked closely with the lender to build their comfort with the trustee sale process, and provide assurance that the bid would prevail based on a high degree of transparency afforded by the sponsor’s relationship with the existing lender. GSP also collaborated with both sponsor and lender to establish a) recent stabilization trends in the submarket, and b) the opportunity to improve net cash flow through better management and operating expense reduction. GSP highlighted the sponsor’s outstanding track-record in stabilizing multi-family investments, and the opportunity to buy 30% below recent comparable sales.
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| | Rate: 1 month LIBOR + 4.75% with a 6.75% Floor | | Term: 3 years with 1 one year extension | | Amort: Interest Only | | LTC: 66% | | Prepayment: None | | Non-recourse | | Lender Fee: 1% plus 1% exit fee | | Brokers: Gary E. Mozer, Steven Orchard, Josh Roseman |
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| | | Hot Money | Attention Apartment Owners! Portfolio Lender Offering 7 year Fixed Rate at 4.92% This is a fixed rate program with flexible prepayment. Loan sizes: $1,000,000 and up. Loan is structured as a 30 year term and 30 year amortization. Rate is fixed for first 7 years then floats at 6 month LIBOR + 2.40%. Max leverage is 70% LTC for purchase, 65% LTV for refinances. Rate locked at application. Prepayment is 4,3,2,1 then par. Recourse required. | | | Hot Money | Nationwide Lender Raises New Bridge Loan Fund, Lending up to 80-85% LTV Lender is long time institutional owner of real estate and has raised a large new fund to take advantage of present market opportunities. Property must have some cash flow in place. Value add plays ok, lender will consider future fundings Loan sizes considered: $10,000,000 to $40,000,000; "Sweet Spot": $20,000,000 to $25,000,000; LTV: 80-85%; Geography: Nationwide, large markets; Interest Rate: 8%; Loan Term: 3-5 years; Non recourse. Lender Fee: 1.0% plus 1.0% exit fee | | | Hot Money | Opportunity Fund Looking to Purchase Minority Interests in Real Estate Assets This is ideal for junior partners in a good property to monetize their interest without a property sale. Fund interests will also be considered. Fund is looking for "A" assets in "A or B" locations in the $10,000,000 to $75,000,000 range, major markets. This fund will also fund Discounted Note Purchases where investors are buying back their own debt. Typical structure is a 12-15% lookback IRR with a promote schedule over a threshold. | | | 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. Click here to join the George Smith Partners group to get access to current conversations and topics. | | | What's Next in the Capital Markets? Check the Rear View Mirror--Blog Post by Nick Silbergeld | Not too long ago when conventional lenders were dormant and banks only answered the phone for the FDIC, there was a great deal of clamor about the massive amount of equity “on the sidelines” waiting to be deployed. At conferences the same question was posed to panelists again and again, “when will the equity be deployed?”.....click here to read the entire post | | | 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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