GSPartners
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Volume XIX | No. 8 | March 2, 2011
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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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2.12%
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5 Yr Swaps
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2.35%
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12-MAT
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0.30%
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3 Month LIBOR
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0.31%
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10 Yr US Treasury
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3.41%
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10 Yr Swaps
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3.53%
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11th Dist COFI
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1.48%
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6 Month LIBOR
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0.47%
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30 Yr US Treasury
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4.49%
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| | | Transaction Description: | | $10,000,000 Senior Loan Workout on a 212,000 SF Mixed-Use Center in the Inland Empire, California. GSP successfully negotiated the modification of a maturing loan secured by a 65% occupied, 212,000 SF mixed-use center in the Inland Empire of California. GSP helped the borrower obtain a two-year extension at the existing interest rate with only closing costs paid out-of-pocket at closing. |
Challenge: The mixed-use center is located in a secondary market and is currently 65% occupied with a unique tenant mix including an entertainment venue, fitness center, medical office users and trade schools. The Borrower had a maturing loan that was housed in a CDO, and the capital markets were unable to become comfortable with the collateral.
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Solution: GSP demonstrated the strength of the Sponsor, the low existing cost basis and the strong in-place cash flow due to long-term tenancy and limited rollover risk to negotiate a one-year extension with another one-year extension option at the existing interest rate. The Sponsor was allowed to pay down the principal balance utilizing the property’s cash flow after debt service, limiting his out-of-pocket costs at closing.
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| | | Hot Money | Owner/User Financing up to $15,000,000 for Purchase or Refinance A capital provider is originating larger predominantly owner occupied (more than 50% by square footage) industrial, office or retail properties on a nationwide level. Acquisition financing from $8,000,000 to $15,000,000 is available to 90% of cost. Refinance debt is also available at lower LTVs. This lender also has the capacity to offer a forward rate lock of up to 12 months. No banking relationship is required. | | | Hot Money | Nationwide Portfolio Lender Funding Aggressively Priced, Non Recourse Bridge Loans This lender is looking for higher quality assets, "big" sponsors and will price accordingly. They are targeting $2 billion of "on book" bridge loans for 2011. For qualifying transactions, this is a fantastic program. For those that don't qualify, there are plenty of higher priced bridge lenders we are accessing. Loan Size: $10,000,000 to $75,000,000; LTV: Non-Recourse up to 65%, will go higher with recourse; Exit Debt Yield: 9.5%; Pricing: LIBOR + 2.50 - 3.50% with NO floor; Amort: Interest Only. | | | Hot Money | Non-Recourse Floating Rate Program for Stabilized or Near Stabilized Properties This program is ideal for borrowers with good properties seeking low cost financing that retains flexibility. Properties must be 80% occupied (lender is very strict on this requirement). Some rehab is ok on this program and lender can "get structural" Loan Size: $25,000,000 and up (no max), can do smaller once first $25,000,000 is on book, portfolios of properties ok; Pricing: LIBOR + 2.50% (No floor); Fixed rate swaps available; Max LTV: 65%; Debt Yield: 10%; Loan Term: 3+1+1, 5, 7 years; Amort: Interest Only for 3 years then amortizing. Non recourse with carveouts. | | | 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 | Steve Bram will be speaking at a USC TREA (Trojan Real Estate Association) event in our offices on March 4. | | | Pascale's Perspective | Government Shutdown--What would it mean for commercial real estate? The prospect of a government shutdown was narrowly averted this week with a last second agreement to raise the debt ceiling. Such an event would rattle confidence in US Treasuries and could cause a sell off among investors and increase treasury yields dramatically. Also, the AAA rating on US debt could be in jeopardy. These events would likely set off "fear factor" in the capital markets, raising all types of risk spreads. Hopefully a solution will be found soon. The "good news" is that all sides may be ready to discuss serious deficit reform. This is key to controlling future borrowing costs and avoiding huge spikes in future treasury yields and therefore loan rates.....Stay tuned.....David 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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©2011 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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