FINfacts™ XXIV – No. 264 | April 21, 2021

MARKET RATES
Prime Rate 3.25%
1 Month LIBOR 0.11%
6 Month LIBOR 0.22%
5 Yr Swap 0.91%
10 Yr Swap 1.57%
5 Yr US Treasury 0.80%
10 Yr US Treasury 1.56%
30 Yr US Treasury 2.27%

RECENT TRANSACTIONS
$45,600,000 Non-Recourse Bridge Financing for Recapitalization of Lido Marina Village in Newport Beach, CA

Rate: Confidential
Term: 2 years with two 1-year extensions
Amortization: Interest Only
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners structured and arranged $45,600,000 in bridge financing for the recapitalization of the Lido Marina Village, a 116,000 sf multi-block, waterfront boutique retail and office property on Balboa Peninsula in Newport Beach. Lido Marina Village features retail, restaurant, and office space in 14 separate structures including prime waterfront retail and restaurant spaces featuring spectacular harbor views, along with 47 boat slips, creating an iconic Newport Beach destination. Some highlighted restaurants include Orange County’s only Nobu and Malibu Farm locations. Retail tenants include first-to-market “laid back luxe” retailers such as Elysse Walker, LoveShackFancy, Serena & Lily, the RealReal, and Jenni Kayne. The Property stretches from the waterfront, across a public street and walkway to the Via Lido street-front retail. It also includes a 372-space parking structure and 91 on-grade parking spaces. The Project is located on 17 legal parcels totaling 3.5 acres, with 4 parcels held as leasehold interests. Since the acquisition in 2013, the Sponsor successfully rebranded Lido Marketplace as a super high-quality boutique and restaurant destination, featuring a “who’s who” of tenants. Even during the pandemic, Lido Marina Village occupancy stayed high, and the Sponsor signed new leases at “high street” rents. The Property has been thriving in part due to their shoppers feeling comfortable in the open air, pedestrian friendly and waterfront environment.

Advisors

Steve Bram
Principal/Co-Founder
David R. Pascale, Jr.
Senior Vice President
Allison Higgins
Senior Vice President
Patrick O’Donnell
Vice President
Nick Rogers
Vice President

$8,400,000 Non-Recourse Acquisition/Bridge Loan for a 50% occupied Hayward, CA Apartments

Rate: LIBOR + 4.25%
Term: 3 Years, with two 1-year extensions
Amortization: Interest Only
Loan-to-Cost: 76%
Repayment: Carve-Outs Only
Prepayment: 18 months
Loan Fee: 1.0% in / 0.25% exit

Transaction Description:

George Smith Partners arranged $8,400,000 in acquisition and bridge financing for the purchase and reposition of a currently 50% occupied, 1960’s-built apartment complex located in Hayward, CA. Our Sponsor placed the portfolio under contract during the COVID-19 pandemic. The financing includes $1,350,000 of future funding for extensive renovations of unit interiors and exterior upgrades, including an earthquake retrofit. Interest is not charged on the holdback until funds are drawn.

GSP identified a national balance sheet lender with an intimate knowledge of the Hayward submarket. They structured and capitalized an interest reserve to cover the shortfall of cash flow during repositions. Sized to 76% of the total capitalization, the three-year bridge loan is interest only for 36 months and carries a floating rate of LIBOR + 4.25% and include two extension options for up to a term of five-years.

Advisors

Portrait Michael Anderson-Mitterling
Senior Vice President
Kyle Howerton
Senior Vice President
David Stepanchak
Senior Vice President
Portrait Robert Gallagher
Analyst
Portrait Saman Yazdi
Analyst

14 Day Quick Close Acquisition Capital for 12 Acre Plot of Land; Western U.S.

Blended Rate: 8%
Term: 24-month, plus a one 12-month extension option
Loan-to-purchase: 55%
Prepayment Penalty: 6 months minimum interest

Transaction Description:

George Smith Partners secured financing for twelve acres of raw land located in the Western U.S. Our Sponsor plans to get a variance for this land to build out five, forty-unit multi-family buildings, with shared open air common areas and a pad for a restaurant. This financing was especially challenging due to the land being unentitled, without water, the location, low loan amount, and lenders being more restricted due to COVID.

Due to GSP’s vast networks and strong relationships, we were able to secure attractive financing for this Project. GSP arranged a 55% loan to purchase at 9.25% interest only, with a 24-month term and 12-month extension option. GSP’s ability to secure this financing in just 10 business days allowed the Sponsor to renegotiate the purchase price and get a hefty discount.

Most land lenders are restricted to 40%-50% leverage. This high-leverage financing structure allows our Sponsor to start pre-development, including entitlements and pulling permits. The extension option gives flexibility to the Sponsor should they face delays in getting to entitlement due to COVID effects. There’s additional flexibility because there is no prepayment penalty. Per our long-standing relationship with the capital provider, we were able to close this transaction in 14 days from receiving the request.

Advisors

Bryan Shaffer
Principal/Managing Director
Ruben Bohbot
Vice President
Michael Smilove
Assistant Vice President

SPEAKERS CORNER

Join us this Friday at 10:00 am PT | 1:00 pm ET for the webinar, “2021: Bear Down or Buckle Up?”

REGISTER TODAY: 2021:Bear Down or Buckle Up? 


Picture
HOT MONEY
Non-Recourse, Interest Only, Bridge Financing

George Smith Partners is working with a nationwide portfolio lender offering non-recourse, on-balance sheet, interest only bridge financing that focusses primarily on apartments, office, industrial, single tenant NNN, self-storage, manufactured housing communities and multiple property portfolios. Typical loan structures include two- or three-year initial terms with extensions up to 5 years, 60-70% as-is LTV (Higher Leverage available with Mezz), as-is debt yield of +-7%, flexible prepay structures and potentially property releases in year one with no spread maintenance penalty for up to 50% of loan. Lender will consider requests with future fundings/earnout or “good news” money and a minimum loan amount of $20,000,000. Pricing is LIBOR plus a credit spread in the L+200-250 range that depends on the asset and cash flow. The Lender holds and services the full commitment for the full term with no CLO or syndication risk.

More Hot Money ›

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


WWW.GSPARTNERS.COM

Constellation Place
10250 Constellation Blvd., Ste. 2700
Los Angeles, CA 90067
Office 310.557.8336
Fax 310.557.1276
Email finfacts@finfacts.net
© 1999 - 2021 George Smith Partners, Inc. DRE # 00822654 FINfacts is an ePublication of George Smith Partners, Inc. For Promotional Purposes Only. All Rights Reserved.
Hi, just a reminder that you're receiving this email because you have expressed an interest in George Smith Partners. Don't forget to add finfacts@finfacts.net to your address book so we'll be sure to land in your inbox!