GSPartners
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Volume XVIII | No. 40 | October 27, 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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1.32%
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5 Yr Swaps
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1.52%
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12-MAT
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0.34%
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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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2.70%
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10 Yr Swaps
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2.71%
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11th Dist COFI
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1.71%
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6 Month LIBOR
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0.45%
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30 Yr US Treasury
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4.03%
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| | George Smith Partners Welcomes Eric Hamermesh | We are proud to announce that Eric Hamermesh is joining George Smith Partners as Senior Vice President and Director of Business Development and Client Services for Team Rifkind. A long time friend and collaborator of the firm, Eric comes to us with a deep background in debt and equity placement, consulting and asset management. Prior to joining GSP, Eric transacted in excess of $3.5B of commercial real estate debt and equity on behalf of top tier companies Archon/Goldman Sachs, Credit Suisse and Canyon Capital. Eric can be reached at ehamermesh@gspartners.com | | | Hot Money | Approved Freddie Mac Mezzanine Lender Actively Investing Behind Senior Agency Debt, Lending up to 90% Combined LTV and 1.05 DCR Lender is a national multi-family real estate mezzanine lender. Their fixed rate loans are ideal for new acquisitions or cash-in refinancing. $1 million is the minimum loan amount and the loan term is coterminous with the Freddie Mac loan. Qualifying properties include stabilized, conventional Class A and B multifamily properties in good physical condition with opportunity for improved performance. | | | 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. | | | 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. | | | Speakers Corner | On Thursday, October 28, Gary M. Tenzer will be speaking on a capital markets panel at the Real Estate Investment Advisory Council event: "Deal or No Deal: Show Me the Money-Where You See It and Where You Don't" For more info, click here. | | | David Rifkind and David R. Pascale, Jr of GSP and Anand Kapadia of De La Rosa / MJW Debt Partners led a discussion titled "The New Cycle Begins" at the Crittenden Conference in Atlanta on Monday. To view their presentation, click here. | | | Pascale's Perspective | QE2 or not to QE2? And if so, how much? These are the questions that should be answered next week during the Fed's two day meeting on November 2-3. Quantitative Easing is the purchasing of treasuries by the Federal Reserve. Speculation has run from "a couple hundred billion" to "about $2 trillion" in purchases. Worldwide equity and bond markets have fluctuated on the speculation. Why does the Fed think it will work? The Fed basically believes it will help in 3 ways: (1) Lowering long term interest rates in order to boost consumer and housing spending; (2) Raise equity markets, creating a "wealth effect" and (3) Lowering the trade deficit. Also, with congress in election time partisan gridlock, this is one of the few "arrows in the quiver" available to the government at this time..... 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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