Dealmaker: George Smith Partners Secures $59M for Multifamily, Office

George Smith Partners, Los Angeles, secured $58.6 million for multifamily and office assets in southern California.

GSP arranged $54 million in permanent financing for a newly completed 173-unit apartment community in Ventura, Calif. The non-recourse loan is fixed for 15 years at 3.01 percent with interest-only payments for the first seven years and with cash out above the construction loan.

When GSP was engaged in January, the project’s final phase had not yet received its certificate of occupancy. Then the state-mandated COVID-19 stay-at-home orders slowed new leasing activity through the spring. So when it initially took the financing proposal to market, GSP faced both occupancy issue and lender conservatism due to the pandemic.

GSP Principal/Co-Founder Gary Tenzer, Principal Antonio Hachem, Vice President Wendy Wang, Assistant Vice President John Choi and Analyst Cornelius Baliukonis worked through the summer to make lenders comfortable with the Ventura market’s resiliency, the property’s quality and the sponsor’s strength. As capital markets improved, GSP narrowed the field to one lender that offered the best combination of loan proceeds, term and rate. Upon reaching 85 percent occupancy, the sponsor executed an early rate lock to hedge against potential swings in the Treasury prior to close.

GSP also secured a $4.6 million construction loan with a two-year term for a medical office building in Oxnard, Calif. The loan floats at Prime plus .5 percent with a 3.75 percent floor rate and will convert to a five-year permanent loan upon construction completion. The mini perm is expected to have a fixed interest rate of 3.65 percent. Loan advisors on this deal included GSP Principal/Managing Directors Shahin Yazdi and Jonathan Lee, Senior Vice President Jarod King, Vice Presidents Matthew Kirisits and Paul Monsen and Analyst Kyle Redmond.