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Commercial Real Estate Loan
DPO Payoff Loan arranged by Bryan Shaffer
310-867-2906
Transaction Description:
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Discounted Pay
Off w/Replacement 1st Trust Deed to 88% of the New Basis Bryan
Shaffer successfully structured a discounted pay off on a 38,000 square
foot distressed office/flex building in the High Desert of Southern
California. The project market was greatly impacted by the economic
downturn. GSP also arraigned the replacement debt to 88% of the new basis.
The five year loan amortizes over 30 years and carries a step-down
prepayment.
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Challenge: Our client purchased this asset for
over twice the discounted note payoff amount in what ultimately became one
of the worst commercial real estate markets in California. No recent sales
comparables exist within this market. Occupancy and cash flow are currently
positive, but there is substantial roll-over risk in a highly vacant
commercial market.
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Solution: GSP utilized a non-bank replacement
lender to meet the requirements of this reposition. The new lender became
comfortable with the Sponsors’ operations of the subject to date and his
capacity to manage the asset in a depressed market. The restated basis and
additional cash equity in addition to the substantial Borrower cash
investment made to date further provided comfort to the Lender that this
Sponsor will carry the asset until the market re-stabilizes.
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Rate: 7.50%
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Term: 5 Years
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Amort: 30 Years
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LTC: 88%
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Prepayment: 3,2,1, open
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Recourse
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Bryan Shaffer
George Smith Partners
Real Estate Investment Banking
CELL 310-270-6328
TEL
310-867-2906
FAX
310-557-1276
