The subject property consists of a 197-unit student housing project on 11.31 acres, located on the campus of the University of California at Davis. The assignment came to the Barry Slatt Mortgage Company after the borrowers received a loan commitment through Fannie Mae that fell short of their expectations. One of the challenges associated with the loan was a 65-year unsubordinated ground lease, with 55 years remaining.  
 
After we presented a number of competitive options, the borrowers agreed to move forward with a life insurance company that offered them an all-inclusive rate of 4.87% (150 basis points over the 15.83 year interpolated yield). Another important feature was that the loan term was fixed for 20 years/30 year amortization.
 
Although we were up against a very short timeline, the loan closed within 40 days from the time the application was executed. On this particular transaction an appraisal was not required. From the borrower’s perspective, one of the main advantages to the loan was their ability to lock the interest rate at the time they signed the application. Being able to offer our client a non-recourse loan also played an important factor in meeting their needs.
 
For more information regarding this transaction please contact Jeff Glenn, the originating banker in our Sacramento office.