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| Rendering of Planned Mixed-Use Project, Financial District, San Francisco, CA |
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| Jonathan Lee |
SAN FRANCISCO, CA –
Commercial real estate investment banking firm George Smith Partners has
successfully arranged $34 million in ground-up construction financing for the
development of a mixed-use property comprised of 90 for-sale housing units
above ground-level retail space in San Francisco’s Financial District,
according to George Smith Partners’ Principal Jonathan Lee, Senior Vice President David Stepanchak and Vice President Adam Candler.
“As job growth continues
based on high-paying tech industry positions in San Francisco, demand for
housing remains on the rise,” says Lee.
“Downtown San Francisco offers a
lifestyle that is appreciated by a myriad of demographics, from Millennials to
Baby Boomers, and we were successful in demonstrating that widespread demand to
lenders.”
George Smith Partners
secured the loan on behalf of the developer, real estate investment and
development firm Encore Capital Management.
Hector Calderon, Managing Director of Encore Capital Management, says, “San Francisco’s
mid-market has transformed in the past four years, attracting major tech
companies such as Uber, Square, Dolby and Twitter. The result is a tremendous number of new jobs
within walking distance of our planned development.”
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| David Stepanchak |
Calderon notes that walkability is a prime consideration when developing in this urban core.
“Our target buyers are
singles and young couples who want to be near the vibrancy of mid-market, as
well as empty nesters that are retiring, downsizing and moving back into the
area.
"These are individuals who want to
enjoy a walking lifestyle, and take advantage of being within four or five
blocks of some of the hottest neighborhoods in the city,” he explains.
The project’s price point
will be entry level, according to Calderon.
“Buyers in San Francisco
can be easily discouraged by the high cost of housing. We plan to offer most of these condos for
less than $1 million per unit, providing an accessible option for San Francisco
workers hoping to buy.”
The planned development is
located in the heart of the San Francisco Financial District, within walking
distance of several popular dining and shopping destinations. The ground-floor
retail space is designed for restaurant use, and can be sold to a single user
or easily subdivided and sold to two separate owner/operators in the future.
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| Adam Candler |
“The flexibility of this
proposed project, coupled with its irreplaceable location in the urban core of
San Francisco made it an attractive project for lenders,” says George Smith
Partners’ Jonathan Lee.
“The challenge, however, was in addressing
lenders’ concerns with regard to fluctuations in the current residential
market.
"Conflicting reports have emerged
in recent months regarding the potential ‘cooling’ of the San Francisco condo
market.
"To alleviate these concerns, our
team focused on demonstrating the strength of the sponsor, as well as the
steady demand for well-located mixed-use space that delivers the live/work/play
environment today’s consumers are seeking.”
Ultimately, George Smith
Partners was able to secure the $34 million non-recourse construction loan with
only a completion and carve-out signature – there is no repayment
guarantee. Sized to 60% of actual costs,
the loan is priced at LIBOR plus 400 with a term of three years, and includes
an option to extend an additional one year.
For a complete copy of the company’s news release,
please contact:
Miki Conant / Jenn Quader
Brower, Miller & Cole
(949) 955-7940
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