Saturday, February 22, 2014

$20.5M GSP FinFacts - Shaffer Team

Transaction Description:
$20,500,000 Customized Multifamily Cash-Out Bridge/Reposition Bryan Shaffer of George Smith Partners successfully placed the $20,500,000 refinance of a San Diego California multifamily apartment community. The bridge loan included a return of equity of $7,000,000 to solve a long-term dispute between the partners. The non-recourse cash-out refinancing allowed family trust issues to be settled at a high 85% LTV leverage with low LIBOR based pricing on an interest only basis.

Challenge: A highly leveraged loan with a virtual break-even DCR constraint was required to settle this partnership dispute. Agencies declined the request due to its lengthy ownership story. Credit and complex trust issues deadlocked the partners' decision-making capacity.

Solution: Utilizing GSP’s long-term capital relationships and Mr. Shaffer’s experience with complex partnership structures, GSP was able to construct a customized bridge loan and place it with a unique REIT lender. The Lender identified with the new borrower ownership structure and was comfortable providing the additional capital to solve the assets’ management issues. Without GSP's involvement, the transaction would have been grid-locked in litigation due to the complex partnership strife and features of the loan request.
Rate: LIBOR+4.50%/Floored at 5.67%
Term: 2 Years + Options
Amort: Interest Only
LTV: 85%
DCR: 1.05
Prepayment: 18 Month Lock then open
Lender Fee: Par
Broker: Bryan Shaffer