FINfacts™ XXIV – No. 293 | November 10, 2021

MARKET RATES
Prime Rate 3.25%
1 Month LIBOR 0.09%
3 Month LIBOR 0.22%
5 Yr Swap 1.29%
10 Yr Swap 1.58%
5 Yr US Treasury 1.23%
10 Yr US Treasury 1.57%
30 Yr US Treasury 1.92%

RECENT TRANSACTIONS
$47,355,000 Construction Financing and $16,500,000 Equity Placement for Two Multifamily Development Communities; Boise, ID

Rate: 4.5%
Term: 2-year construction and 3-year perm
LTV: 74%
Guaranty: Non-Recourse

Transaction Description:

George Smith Partners successfully advised on $47,000,000 in construction financing and $16,500,000 in JV Equity for the development of two multifamily communities, totaling 213 units with 184,900 of net rentable square feet located in Garden City, a submarket of Boise, ID. The Sponsors have a long-term bias toward the market, having completed over $75,000,000 in financing in the area. This transformative Project is a key component of their overall master plan and vision for Downtown Garden City.

GSP worked through several strategies to source the right non-recourse financing terms and joint-venture equity partner for the ground-up multifamily community. Ultimately, GSP successfully obtained several financing options. The Sponsor selected a life-company lender with exceptional terms and a joint venture equity capital partner with a long-term partnership vision.

The Sponsor projects a timely delivery and lease-up period of the Project in late 2022. The demand for housing remains robust in Garden City due to the continued tailwinds, driven by the influx of individuals seeking housing in Idaho.

Advisors

Evan Kinne
Senior Vice President
Ed Steffelin
Senior Vice President
Jonathan Lee
Principal/Managing Director
Shahin Yazdi
Principal/Managing Director
Miles Musalman
Senior Vice President
Kyle Redmond
Assistant Vice President
Portrait Blair Lewis
Assistant Vice President
Jordan Lipton
Analyst

$14,000,000 Cash-Out Refinance of a 4-Property Multifamily Portfolio at 3.15%,70% LTV; Los Angeles, CA

Rate: 3.15%
Term: 30 years term, fixed for first 5 years, resets every 5 years after for the term.
LTV: 70%
DCR: 1.15

Transaction Description:

George Smith Partners arranged $14,000,000 in cash-out permanent financing,70% LTV for the refinance of a 4-property multifamily portfolio located in Los Angeles, CA. Due to GSP’s vast activity, we were able to time the loans to match up with a special discount program offered by a regional lender. GSP structured the portfolio to maximize the cash-out to the Sponsor at the lowest possible cost. With over $3,000,000 in cash out, the Sponsor still lowered their monthly debt service. GSP was able to arrange a 30-year term with the first 5 years fixed at a rate of 3.15%. The rate will then reset every 5 years for the remainder of the term. The flexible prepayment structure is equal to 1.75% for the first 3 years, 1% for years 4 and 5, and 0% thereafter. The cash-out financing provides the Sponsor with equity allowing them to continue to grow their multifamily portfolio. GSP was able to meet the Sponsor’s deadline and close this transaction within 40 days from signing the term sheet.

Advisors

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

$3,400,000 Flex Office Refinance with100% Roll; Santa Barbara, CA

Rate: 3.50% Fixed for Five Years
Term: Ten Years – 5+5
Amortization: 30 Years
Loan to Value: 65%
Reserves/Holdbacks: None
Lender Fee: Par

Transaction Description:

George Smith Partners placed the refinance of a two-tenant flex-office building in the central business district of Santa Barbara. Currently 100% leased and occupied, there is a 100% roll within the next 20 months. Our Sponsor reduced his current coupon by over 50 bpts and locked in today’s historically low interest rates for five years rather than facing interest rate risk in two years when his current loan would have matured. Our Sponsor also benefited from a nominal return of equity. Despite the tenant roll, there are no holdbacks, reserves, escrows, or impounds. The interest rate was locked at application without the requirement of a deposit. Sized to 65% of appraised value, the ten-year term is fixed for five years before a fixed rate reset for the remaining five-year term. Amortized over 30 years, prepayment steps down from 3% and is open the remaining two years of each five-year term. All prepayment penalties are waived in the event of a sale.

Advisors

David Stepanchak
Senior Vice President
Portrait Michael Anderson-Mitterling
Senior Vice President
Kyle Howerton
Senior Vice President
Heather Gonzalez
Closing Specialist/Executive Assistant
Portrait Robert Gallagher
Analyst
Portrait Saman Yazdi
Analyst

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HOT MONEY
Multifamily Financing Starting at 3.20%

George Smith Partners is working with a capital provider funding permanent debt to 75% LTV. With a strong appetite for Multifamily, Office, Industrial, Retail, Self-Storage and Mixed-Use properties the Lender offers fixed rates starting at 3.20% for 5-year loans in 9 Western U.S. states for transactions up to $25,000,000. The Lender has non-recourse and interest-only options available along with aggressive underwriting down to a 1.15x DSCR.

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


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