GSPartners
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Volume XX | No. 46 | November 28, 2012
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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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0.21%
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5 Yr US Treasury
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0.64%
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5 Yr Swaps
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0.78%
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12-MAT
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0.17%
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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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1.63%
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10 Yr Swaps
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1.68%
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11th Dist COFI
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1.04%
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6 Month LIBOR
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0.53%
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30 Yr US Treasury
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2.80%
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| | | Transaction Description: | | $12,900,000 Multi-Tenant Industrial/Flex Portfolio Cash-Out Refinance George Smith Partners arranged the refinancing of 2 industrial/flex buildings in San Jose totaling approximately 280,000 square feet. The buildings are 65% occupied. One of the two buildings is master-leased by the borrower (with some sub-lease tenants). The second building is recovering from a dip in revenue that generated a discounted pay-off agreement with the existing lender. By cross collateralizing the assets, supporting a positive shift in leasing activity, and proving-out the borrower’s equity position, GSP secured a loan with cash-out proceeds in-excess of the discounted loan pay-off amount. |
| | Rate: 4.50% Fixed for 7 years; One-Month LIBOR plus 2.75% thereafter. | | Term: 10 Years | | Amort: 25 Years | | LTV: 65% | | LTC: 100% | | Prepayment: 2/2/1/1/open | | Recourse | | Brokers: Steven Orchard, Michelle Lee |
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| | | Transaction Description: | | $6,600,000 Office Building Acquisition Financing in Encino, California GSP arranged the 90% of cost acquisition financing for a multi-tenant office building in Encino, California. The client occupied portions of different office buildings in the market. This purchase allowed the Borrower to consolidate offices and storage units into one building for more control and proficiency. The 90% Loan to Value financing was arranged under the SBA 504 program, where the blended rate of the Bank’s 1st TD and SBA’s 2nd TD was 4.565% with 10 year fixed term amortized over 25 years. |
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| | | | High Leverage Non-Recourse Construction Debt GSP is working with an institutional lender funding very large construction and reposition transactions in gateway cities. Loan requests of $25,000,000 and up will be underwritten to 85% to 90% of total costs on a non-recourse basis. Hospitality and spec (un-leased) assets will be considered with the proper metrics. Yields are risk based: high single-digit to low double-digit depending on the asset and leverage. Terms are limited to three years. |
| | | Hot Money | Non-Recourse Reposition to 65% of Proforma Value A true bridge lender looks to their exit valuation in determining loan proceeds. GSP has identified a national firm funding to 65% of “real lender value” upon stabilization. Loan requests from $10,000,000 to $100,000,000 are priced 6% to 8% with an option to layer on additional preferred equity behind their own senior if additional funds are required. In-place cash flow is not required at funding. Core assets, hospitality and condo conversions are considered on a non-recourse basis. DPOs will require a fresh equity contribution from the borrower. | | | If you have an inquiry regarding George Smith Partners' commercial real estate financing, please contact your GSP representative or Todd August, Chief Operating Officer, at (310) 867-2995 or TAugust@GSPartners.com | | | In The News | Senior Vice President Malcolm Davies was recently quoted in the November Issue of Multifamily Executive on condominium trends. Mr. Davies discusses where condo developers are adding renewed due diligence in contemplating new construction. The article is available on-line and may be found here. | | | Omer Ivanir, Esq. | Congratulations to GSPs Omer Ivanir for passing the California Bar Exam. All lender legal work will still be deferred to outside counsel. | | | Pascale's Perspective: | Fiscal Cliff “Fix”? Kick the can, or structural reform? …..The Fiscal Cliff deadline of December 31st has markets breathlessly awaiting news of a “solution” i.e. a compromise that will avoid any shocks to the economy if the December 31st “triggers” go into effect. Recent signs of a willingness to bargain from all sides have buoyed investors. The larger question is when will the US address the major balance sheet issues going forward? The rating agencies and holders of treasuries will not wait forever, some think that some significant deficit reduction needs to be implemented in 2013-2014. Also, any real “fix” needs to also address the looming debt ceiling limit. ...Stay Tuned... David R. Pascale, Jr |
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©2012 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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