Finfacts XXIV – No. 443

Transaction Description:   

George Smith Partners closed a loan in the amount of $6,300,000 for the construction of a 14-unit, build-for-sale community located in Colorado. This is the second closing in a programmatic partnership between the lender and the developer. The initial interest rate on this loan is lower due to a lower LTC. For this loan, the lender had already completed the due diligence work to understand the modular build project and the Sponsor. As a result, the loan closed in just 45 days, which is very fast for a construction loan. 

Transaction Description:   

George Smith Partners closed a $10,550,000 loan for the construction of a master planned community located in Northern California. The build-for-sale project consists of 25 units and has shared amenities and common space. The request presented a unique challenge in that the individual units are prefabricated offsite and transported to the property. 

GSP was able to source a lender that specializes in phased developments and is comfortable with prefabricated construction. The loan is non-recourse, with the carve out guarantees signed by a corporate entity rather than an individual. The overall funding is 75% of the project costs. The floating rate will allow the borrower to benefit if interest rates decline.