GSPartners
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Volume XVIII | No. 45 | December 8, 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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1.83%
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5 Yr Swaps
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2.10%
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12-MAT
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0.33%
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3 Month LIBOR
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0.30%
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10 Yr US Treasury
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3.21%
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10 Yr Swaps
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3.38%
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11th Dist COFI
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1.65%
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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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4.43%
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| | | Transaction Description: | | $5,000,000 Credit Facility for Single-Family Home Lender. GSP successfully arranged a credit facility for an experienced private lender who provides short term financing to professional home wholesalers (aka flippers). GSP worked closely with a local bank that was comfortable with the company’s business plan and track record as a private short-term lender. The credit facility allows the private lender to leverage their equity in an effort to grow their business.
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| | Rate: Bank Prime + 3.0% | | Term: 6 months from funding of each advance | | LTV: Lesser of 50% of as-is value or 70% of loan to home buyer | | Prepayment: None | | Non-recourse | | Lender Fee: 0.5% | | Brokers: Steve Bram, Allison Higgins |
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| | | Hot Money | CMBS Update-Spreads Tighten, Coupons are Higher due to Treasury and Swap Volatility The good news is that the CMBS market is strong with new lenders appearing (or reappearing) at the rate of 1-2 a month. More lenders equals heightened competition for transactions. Also note: Hotel transactions are being quoted. Some high profile hotel loans have funded recently (including large portfolios and big one off transactions such as Times Square Hilton). The not so good news is treasury and all in swap rates are spiking and driving up rates. Right now, 10 year loans are being priced as low as Swaps + 2.25-2.50 or about 5.75%. Historically, this is still a good non-reourse rate for office, retail, industrial, hotels, etc. Some lenders will size to a 9.5% debt yield, 75% LTV. Forecasts call for big volume in 2011. | | | Hot Money | California Portfolio Lender Funding Mini Perms, $5,000,000 and up, 3 or 5 Year Fixed Rates at 3.74% (3 year) and 4.50% (5 year) This program is ideal for borrowers wanting fixed rates with some flexibility, ultra low 3rd party costs, and simple docs. Loans are typically 50% recourse and priced over the corresponding Swap rate. Some 7 year loans will be considered on a case by case basis. Leverage: Up to 1.25 DCR / 70% LTV for apartments, 1.30 DCR / 65% LTV for office or industrial, and 1.35 DCR / 60% LTV for retail. Loans can also float over LIBOR with a spread or "ABR (Alternative Base Rate)" with start rates as low as 2.77%! Amortization: 30 years for apartments, otherwise 25 years. Simple process and documentation: Legal and processing costs are about $3,500, property tax impounds only. Lender fee: 1.00% | | | Hot Money | Aggressive "Full Leverage" Permanent Program Funding Loans $15,000,000 and up, Nationwide This lender is pushing leverage in to 1.15 DCR and 80% LTV for good transactions. It's a "one-stop shop" senior/mezz or B note for stabilized "Core 4" property types plus hotels. Transaction Size: $15,000,000 and up; Rate: 5.50-6.50% approx; Amort: 25-30 years; Max LTV: 80%; Min DCR: 1.15. Non-recourse Property Types: Apartments, Office, Retail, Industrial, Hospitality; Prepayment: Defeasance or Yield Maintenance; Fees: 0.25-0.50%; Geography: Nationwide | | | 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. | | | "Kafkaesque Moments With A Special Servicer" - A New Blog Post by Nathan Auslander | Special Servicers generally are charged with obtaining the highest net present value (NPV) when disposing of assets (mostly non-performing notes). However, it’s not that simple, as Special Servicers also factor in issues such as......click here to read the entire post | | | Pascale's Perspective | "Knock-Knock" "Who's There?" "Bond Vigilantes" Just when you thought the bond vigilantes were busy in Greece, Portugal, Ireland, Spain, Iceland, etc pushing up sovereign debt yields of troubled European economies, they have come to our side of the pond on the heels of the tax cut compromise by US lawmakers. Bond vigilantes are investors that demand higher yields due to perceived risk stemming from large deficits. Also, investors believe that If the tax cuts accelerate the recovery, inflation and rates will rise. The 10 year Treasury hit 3.30% today, note that it was at 2.41% in early October. Hopefully spreads will contract and keep loan rates relatively stable. We may be entering a period where floating rates remain super low, while fixed rates rise.....Stay tuned.....David R. Pascale.... | | | 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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