GSPartners
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Volume XXII | No. 4 | January 29, 2014
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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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0.16%
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5 Yr US Treasury
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1.50%
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5 Yr Swaps
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1.64%
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12-MAT
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0.13%
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3 Month LIBOR
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0.24%
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10 Yr US Treasury
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2.68%
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10 Yr Swaps
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2.82%
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11th Dist COFI
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0.78%
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6 Month LIBOR
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0.33%
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30 Yr US Treasury
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3.62%
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| | Analyst-Structured Finance Request | George Smith Partners is growing and seeking an experienced Analyst for Structured Finance. Position Information and Contact may be found here. | | | | Transaction Description: | | $49,500,000 Non-Recourse Ground-Up Mixed-Use Construction Loan GSP successfully arranged the $49,500,000 non-recourse, construction loan for a 65,000 square foot office, retail, and apartment project in Palo Alto, California. The subject is adjacent to Stanford University. The developer received the necessary zone change and entitlements in 2009 but construction was delayed during the market down-turn and the lack of construction financing. |
Challenge: The Sponsor required high-leverage, non-recourse construction financing with no additional equity requirement. |
Solution: GSP demonstrated the incredible strength and desirability of the Palo Alto office market, one of the tightest in the Country with less than a 5% vacancy and monthly office rents reaching $8.00 psf NNN. The lender understood the value of this location as well as the value of the new zoning obtained in 2009. The lender provided a 75% loan-to-cost, non-recourse financing structure with a 30-month term which utilized the existing cash and imputed equity in the project. The Sponsor only supplied a completion guarantee. |
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| | | Transaction Description: | | $3,945,000 Construction Financing for 2 Retail Pads Sub-3% George Smith Partners arranged construction debt for 11,000 square feet of in-line retail pads; 4 tenants total, 2 in each pad. The pads are located adjacent to a newly built 400 unit luxury apartment complex next to an 840,000 square foot regional shopping center anchored by Whole Foods, Costco and over 70 shops and several restaurants. This pad development caps off three years of new development on this adjacent parcel including the Costco and apartment complex. The challenge was finding a bank willing to “dust off” their retail construction hat as virtually no new retail has been built ground-up since the credit crisis. The loan also provides a well-priced mini-perm upon stabilization as the recourse will be reduced to 25% and the interest only LIBOR based coupon is estimated to be sub-3% for several years. |
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| | | | Regional Bank Funding on a National Level George Smith Partners is placing mini-perm and permanent debt on stabilized transactions from $1,000,000 to $10,000,000. Fixed rate terms to 15 years is available with step-down prepayment options in most national MSAs. Core assets and self-storage are considered to 80% LTV for multifamily and 75% LTV on commercial assets. Limited and non-recourse options are available on lower leveraged executions. |
| | | 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 | | | Congratulations Steve Bram on 30 Years with George Smith | The Principals, Producers and Administrative Support all reach out to Steve Bram and offer him a very warm and heart-felt congratulations on his 30th year of joining George Smith Partners. Here’s to 30 more years! |
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©2014 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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