February 7, 2018
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George Smith Partners arranged $233.6 million in cash-out refinancing for a multifamily portfolio comprised of two DTLA properties owned by G.H. Palmer. The assets include the Medici at 725 South Bixel St., and Orsini I at 505 North Figueroa St. (pictured above).
The 10-year, non-recourse loan closed at 4.02%, was sized at 60% of value, and was arranged as interest-only for the entire term.
George Smith Partners’ Gary M. Tenzer, who arranged the financing on behalf of the sponsor, says, “The sponsor had existing debt on the portfolio, with two years remaining and pre-payment penalties in place, which would typically discourage an early refinance.”
By looking at the whole picture, it became clear that the long term savings of securing a 10-year fixed rate loan at today’s low interest rates outweighed the relatively minimal defeasance fees. “The result was an exceptionally accretive transaction for our client,” said Tenzer.
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