Dealmaker: George Smith Partners Secures $46M For Houston Multifamily

(Houston subject property photo courtesy George Smith Partners, Los Angeles.)

George Smith Partners, Los Angeles, secured $46 million to refinance two Houston multifamily properties.

The properties remain a few months away from stabilization, but GSP secured a three-year permanent loan instead of a higher-cost bridge loan to pull cash out to the sponsor at a cheaper rate. The firm also negotiated a favorable prepayment premium so the sponsor could pull more capital out in 18 months.

GSP said the sponsor’s original bridge loan was priced at LIBOR + 4.75%, so with interest rates increasing, their all-in rate exceeded 9%. The sponsor had completed 80% of the unit improvements and all exterior upgrades, but because of COVID they remain about 20% below the target net operating income.

GSP Managing Director & Principal Bryan Shaffer and Director Ruben Bohbot structured 5.28% fixed-rate loan with 24 months of interest-only payments.