GSPartners
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Volume XVIII | No. 37 | October 7, 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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1.13%
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5 Yr Swaps
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2.64%
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12-MAT
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1.71%
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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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2.38%
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10 Yr Swaps
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3.80%
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11th Dist COFI
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0.34%
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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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3.71%
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| | | Transaction Description: | | $8,000,000 Permanent Financing for two Parking Structures in Downtown Los Angeles, CA GSP successfully arranged a 7-year loan for two stand-alone parking structures which had a mix of long-term leases, month-to-month leases, and daily parking income. GSP solicited over 40 lenders before finding the one lender that was not only comfortable with this product type but the fact that one of the structures was new construction and not yet stabilized. The lender structured a $300,000 hold back to allow the new structure to reach a 1.20 dcr at which point the hold back would be released. The lender also agreed to consider an additional funding when the ground floor retail in the new structure was leased. The lender provided a loan up to 65% of the current value with the potential for an additional funding up to $15,300,000, 65% of the proposed stabilized value. |
| | Rate: 7.0% | | Term: 7 years | | Amort: 25 years | | LTV: 65% | | Prepayment: None | | Non-recourse | | Lender Fee: 1.5% | | Brokers: Allison Higgins; Steve Bram |
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| | | Transaction Description: | | Owner User Financing for 30,125 Sq Ft Industrial Building GSP was retained to refinance a 30,125 sq ft Industrial property in Rancho Dominguez, CA. Our client was planning on occupying the space immediately upon closing escrow so they were looking for a Owner-User loan.
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Challenge: (1) The company and the guarantors did not have enough “Global” income to support the Debt Service payments based on traditional underwriting guidelines; (2) The US Company was owned by an International Company, whose financials were not available
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Solution: (1) GSP identified a Lender who underwrote the company’s financials (vs. a “Global Cash Flow analysis”) and required a lower Debt to Income ratio for the loan; (2) Lender is familiar and comfortable with the International Company |
| | Rate: 6 month LIBOR + 2.50% | | Term: 5 years | | Amort: 25 years | | LTV: 50% | | Prepayment: None | | Broker: Shahin Yazdi |
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| | | Hot Money | Life Company Update -- Rates in the Low 4's for 5 year Term Life Companies are still looking for Class A properties in primary and good secondary locations with "limited hair" Underwriting is based on marking rents to "most recent signed lease" and market vacancy. Loan amounts are based on a 10-12% debt yield. More underwriting is being done as lenders are not sure of how to calculate "LTV" in today's moving target cap rate environment. Some are willing to look outside the core product types including mixedc use, mobile home parks, self storage, etc. They are also willing to compete with the agencies on class A apartments. Rates: 5 year term, 4-5%, 10 year term: 4.75-5.50%. Amortization: 25-30 years. | | | 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 | | | 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. | | | Market Update from Head of CMBS Group - Blog Post from Steven Orchard | We recently had a meeting with the head of a major CMBS shop, and noted the following comments of interest: click here to read entire post. | | | Pascale's Perspective | QE2.....A pleasure cruise? QE2=Quantitative Easing, Part 2. There is debate among the Fed's governors over whether to embark on another round of purchasing treasuries with proceeds from maturing mortgage bonds owned by the Fed. This is another policy meant to stimulate economic activity. There is also debate over how much easing is necessary to prevent the dreaded double dip. There is definitely lots of well priced credit in the market available to real estate investors, public companies, institutions, etc. However, small business lending is still lacking (its still too early to tell whether the recent targeted legislation will have the desired affect).....there is a meme out there among some economists that what is missing is the risk appetite or "animal instinct" among entrepeneurs, small businesses, etc....it is difficult or impossible to legislate or set policy to stimulate that elusive "x factor" that creates such confidence.....Stay tuned...David R. Pascale, Jr. | | | 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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