Planned development will be one of the largest multifamily projects to be built in the Brentwood neighborhood in the past decade
LOS ANGELES, Calif. – March 2, 2015 – (RealEstateRama) — Commercial real estate investment banking firm George Smith Partners has successfully arranged $21 million in financing for its client, Elite Real Estate, LLC, for the ground-up construction of a 49-unit apartment community in the Brentwood neighborhood of Los Angeles, California.
The development is planned to be one of the largest multifamily projects built in Brentwood in the past decade, totaling more than 80,088 square feet of living space, according to George Smith Partners’ Senior Vice President Jonathan Lee. Lee was assisted in the transaction by George Smith Partners Analyst, Adam Candler.
“The Brentwood area has seen little development over the past ten years, fueling pent-up demand for high quality rentals in this affluent marketplace,” explained Lee. “This luxury, Class A development is well-positioned to be competitive in the market. The project will feature units that are built to condominium specifications, resulting in large unit sizes when compared to neighboring communities.”
Lee noted that the project’s large luxury units, while attractive to renters, require a per-unit cost that is relatively high. In addition, Elite Real Estate, Inc. was seeking a high loan-to-cost of 80 percent.
To justify the loan-to-cost ratio and the per-unit cost, George Smith Partners conducted an in-depth study of the market, according to Lee.
“We were able to demonstrate to lenders that the large units, coupled with the market’s strength and lack of supply, would result in premium rents for the community when compared to neighboring apartment buildings,” he says.
Lee explained that while Elite Real Estate is planning to develop the community as for-rent apartments, the land is also entitled to be sold as for-sale condominiums.
George Smith Partners Analyst, Adam Candler explained, “By entitling the property to include a condominium tract map, our Client was able to provide the lender with additional investment security, based on this additional exit strategy.”
He added, “This element was crucial for lenders, ultimately allowing George Smith Partners to identify and secure a lender that recognized the value in the project, and was willing to provide the specific financing our Client desired.”
The financing was secured for 30 months at LIBOR + 2.5 percent, with recourse limited to the top 50 percent of the loan amount.
The property is located at 11965 – 11973 Montana Avenue in the Brentwood neighborhood of Los Angeles, within walking distance of high-end dining, shopping and entertainment along San Vicente and Wilshire Boulevards.
When completed, the multifamily community will consist of two- and three-bedroom units averaging 1,606 square feet. The units will feature premium finishes such as hardwood flooring; Italian kitchen cabinets; premium stainless steel GE appliance packages; luxury bathrooms with soaking shower/bathtubs and vanities; and in-unit washer/dryers.
The community itself will feature a swimming pool/spa, as well as a rooftop deck, providing residents entertainment space with city and mountain views.
About George Smith Partners
Founded in 1992, George Smith Partners is a leading national real estate investment banking firm that specializes in arranging financing for commercial and multifamily properties, including acquisition, construction, bridge and permanent loans, as well as mezzanine loans, highly leveraged participating loans and joint venture equity. The company has arranged more than $35 billion in financing since its inception. Additional information about George Smith Partners is available at www.GSPartners.com.
Corynne Randel/ Jenn Quader
Brower, Miller & Cole