Major bank getting more aggressive on proceeds and pricing. Still very focused on asset and sponsorship quality, but when they find a deal they like, they will stretch to win it.
Program:
- Non-recourse
- 5-10 year term
- 6.50% to 8.00% fixed interest rate
- 20-30 year amortization
- Can do interest only for low LTV or shorter term
- High quality assets (near life company standards)
- Experienced and liquid sponsors with no legacy problems
- Prefer larger deals – $10m minimum
Loan sizing is based on an artificial A/ B note structure:
- Note A – Normal underwriting to around 11%-12% debt yield (NOI/loan amount) assuming 30 year amortization
- Note B – Underwrite to a max 1.05 DCR; amortize excess proceeds over term of loan and blend so might push total amort to low 20 years
Bryan Shaffer George Smith Partners bshaffer@gspartners.com
