Finfacts XXIV – No. 453

Transaction Description:  

George Smith Partners arranged an agency perm loan for this recently constructed active adult senior living apartment complex in the Inland Empire. The gated complex is a mix of one and two bedroom units with patios or balconies. Amenities include resort style pool with spa/hot tub, recreation room, BBQ, laundry facilities on each floor, a salon, and fitness center. The Sponsor completed construction and leased up at a good pace, without concessions. Property is consistently occupied at over 95%. GSP worked with the Sponsor to tighten the loan spread through SDW (Sponsor Designated Workforce) and a rate buydown. SDW allowed borrower to choose a maximum rental level based on county AMI (Average Median Income) that works for his business plan. The rate buydown resulted in an increase in loan proceeds greater than the buydown cost. Rent growth is solid and we plan on arranging a supplemental loan in the next few years.