COMMERCIAL LENDING

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Spearhead Commercial Capital brokered a $35 million acquisition loan for a value-add opportunity in the Tampa Bay MSA. The Borrower is a long-time commercial real estate investor who owns and manages over 8,000 units across the United States. All of the acquisitions are long-term B and C class properties that receive light tenant improvements.   For this purchase, the Borrower was looking for non-recourse financing that avoided agency debt due to current market restrictions too severe for their investment strategy. The Borrower also wanted the lowest rate in the market, 65% LTV, 60-day close, 1.00x DSCR. Spearhead Commercial Capital partnered with a national bank to provide financing through a SWAP fixed-term loan. The loan allowed for a 10 year term with four years of interest-only payments and a fixed rate of 2.95%. The Borrower was also not required to supply the bank with any P&I reserves. Rather they created a covenant to monitor liquidity instead. When the improvements to the building are completed and the rent roll stabilized, the Sponsor's recourse will decrease from a 50% limited guarantee to a non-recourse.    

 "It was an amazing experience for us to work for one of the largest private multifamily investors in the country on this transaction. The subject property will fit nicely within the portfolio that the borrower has built over the last 40 years. We are excited to have added value and creativity to a borrower whose previous lending relationships couldn't match the terms of the structure we negotiated. Spearhead takes great pride in being consultative and focusing on the investor's strategy to bring not only the best loan terms but the right loan terms to match that strategy. Mission accomplished here as we look forward to earning our keep on future projects as client's portfolio continues to grow." - William Foy, Partner