GSPartners
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Volume XVIII | No. 38 | October 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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0.26%
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5 Yr US Treasury
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1.12%
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5 Yr Swaps
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2.67%
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12-MAT
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3.42%
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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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2.43%
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10 Yr Swaps
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2.50%
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11th Dist COFI
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1.71%
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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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3.82%
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| | | Transaction Description: | | $112,200,000 Refinance of Multi-Family Apartment Complex in Santa Clarita. GSP arranged the financing for a 752 unit apartment complex utilizing HUD’s 223(f) program. The proceeds were used to refinance a maturing loan.
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Challenge: The lender was concerned about market conditions, specifically whether there was enough renter demand to support occupancy levels. Additionally, while in application the lender changed the process for how large transactions are reviewed and approved |
Solution: GSP constantly communicated with third parties and the client to solidify market rents and occupancy trends and relayed the information to the lender. GSP also provided quantitative and qualitative analysis for the client to determine all the benefits of the lender’s proposal. GSP coordinated with the lender to understand the new loan process and kept the client informed throughout. The financing is reportedly the largest ever done under HUD’s 223(f) conventional loan program.
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| | Rate: 3.75% | | Term: 35 years | | Amort: 35 years | | LTV: 82% | | DCR: 1.18 | | Prepayment: Stepdown | | Non-recourse | | Lender Fee: 0.50% | | Brokers: Gary M. Tenzer, Nick Silbergeld |
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| | | Hot Money | CMBS Continues to Mature: Robust Secondary Market, New Originators and Low Rates Lead to Opportunity for Borrowers We are seeing increased competition for good transactions among lenders, increased leverage, great rates, here's the latest... Transaction Size: $10,000,000 and up; Rates: 10 year pricing just about 5.00%, 5 years in the mid 4% range; LTV: 75% for core 4 product types (up from 70%); Debt Yield: as low as 9-9.5%; Mezzanine: Available, underwritten down to an 8% debt yield, rates in the 12-14% range, blended cost of capital for high leverage loan is about 7-8%; Lender Fee: par to 0.50%, larger deals are usually 0.25%, Non-recourse | | | 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. | | | 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. | | | CMBS Delinquencies Increasing -- New Blog Post by Scott Swisher | Spreads are tightening and lenders are actively originating new CMBS debt. However, 22.6% of CMBS loans that were underwritten with pro forma (instead of in-place) cash flows at the peak of the market in 2006 and 2007 are now delinquent.....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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