Acquisition Financing for Bank-Owned Subdivision of 8 Completed Houses and 23 Finished Lots
This acquisition loan originated from the highly professional and well-respected selling broker, Marc Kleiman of Province West. His objective was to offer the newly contracted buyer a combination of financing certainty, responsiveness and excellent private-money pricing. From prior experience, Marc knew to call Seattle Funding Group of California.
While on the larger side of SFG’s present lending models, the loan possessed a compelling mix of property and sponsor related factors. And the professionals at SFG knew the sub-market, asset class and inherent values sufficient to respond quickly to the Broker’s request. The asset was unique and well located. The sponsors were capable and experienced. The purchase price, capital structure and protective equity (under 54% Loan to Cost or LTC) were sensible. As a result, SFG’s conditional YES was almost immediate, our Team was quickly and fully engaged, and the transaction closed right on schedule. Purchase price $11.25 million. (Over $5.5M cash down from the Sponsors)
SFG has long focused on a conservative lending model built around “A” paper loans within the private money space, but we understand the opportunities and dynamics presented by distressed assets, as well. Unique properties, core locations, capable and well-capitalized sponsors, solid management and exit strategies…right over the plate for the executives at Seattle Funding Group.
One of the requirements of the Sponsor was that SFG have no prepayment penalty and no yield maintenance. It was the Sponsor’s strategy and intent to quickly sell the standing inventory to retire the loan. Their strategy was executed as planned, the loan retired in under six months, and inasmuch as SFG does not charge prepayment penalties, the Sponsor met their yield objectives.
Once again, Valery Neuman played a pivotal role in the process of establishing value and present market conditions. We’d like to thank and highly recommend Valery Neuman, Catherine Badger and the entire Neuman Team Their expertise in The Valley’s luxury residential market is extensive and invaluable. For years, SFG has been able to rely upon Valery and the many professionals on her staff to assist us with navigating values and avoiding exposure in the Coachella Valley.