Rate: LIBOR + 7.00%
Term: 18 Months
LTV: 77%
LTC: 74%
Amortization: Full Term Interest Only
Prepayment: 10-month Make-Whole
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners arranged $39,500,000 in non-recourse financing for the acquisition of a vacant 10-story office building, currently mid-conversion to a 148-unit, Class-A multifamily building. The Property is the only high-rise apartment building in Downtown Santa Ana. The financing allows the Sponsor to complete the conversion, stabilize the Property, and refinance into long-term permanent debt. While the apartment market is very strong in Downtown Santa Ana, there are no other high-rise apartment buildings and no direct comparable properties. Not only did the Lender have to get comfortable with the construction completion, they also had to get comfortable with a new product type in this market.

GSP identified a local lender that not only understood the market and demand for multifamily but was comfortable with the Sponsor’s ability to step-in and complete the conversion.

Advisors

Steve Bram Managing Director & Principal / GSP Co-Founder

Allison Higgins Senior Vice President

David R. Pascale, Jr. Senior Vice President

Nick Rogers Vice President

Rate: 5.5%
LTV: 60%
LTC: 65%
Term: 12 months
Recourse: Full Recourse

Transaction Description: George Smith Partners secured an $8,150,000 pre-entitlement land development loan for a proposed 400-unit project in Montana. The 65% loan to cost financing is priced at 5.00% over LIBOR (with a 50-bps floor) interest only. The loan will allow the Sponsorship to build out the necessary infrastructure to obtain the plat map and secure full entitlements in 2021. The Project will be one of the largest in the state of Montana and this crucial financing is essential to meet the growing housing shortage in these markets which have accelerated during the COVID-19 pandemic.

Challenge: The large, pre-entitlement project is situated on the outskirts of a tertiary market that was officially classified as a Micropolitan Statistical Area (according to the 2010 Census). Moreover, despite the Institutional Sponsorship, the small market is not a target focus for many regional or national lending institutions traditionally capable of handling loans of this nature. The size of the loan also precluded many local/state banks from obtaining the necessary leverage for the Project.

Solution: GSP secured a regional bank with headquarters near the Project which could understand the growth metrics of the projected Metropolitan Statistical Area (based on the 2020 Census) and how the Project will be vital to the long-term development of the City. The bank relied on the financial strength of the Sponsorship to advance 65% LTC and become comfortable with the pre-entitlement status of the Project. The loan which closed in 45 days from application also included a necessary bank provided, letter of credit to the City which guarantees the necessary capital to be invested into the Project to obtain entitlements.

Advisors

Matthew Kirisits Director

Rate: 3.75% Fixed; Adjusts every 10th year
Term: 25 Years
Amortization: 25 Years
LTV: 66%
Guaranty: Recourse

Transaction Description:

George Smith Partners successfully arranged a $4,400,000 refinance of two flex buildings, totaling 68,169 SF, in Jacksonville, FL. This was a permanent, recourse loan at 3.75%, fixed for the first 10 years with a rate reset at every 10 years thereafter. This is a fully amortizing 25-year loan. The two buildings are adjacent to each other and offer a mix of flex, office and retail space. Both buildings are currently 100% occupied with minimal impact of COVID-19 on its tenants. The Sponsor, a repeat client, acquired the Property just a month prior and engaged GSP to capitalize on the low interest rate environment.