Inauguration, Credit Markets Thaw Further and 2nd Half of Bailout Funds Released

Barack Obama was sworn in as the 44th President of the United States on Tuesday. In his Inaugural Address, President Obama declared his number one objective is that of repairing the broken U.S. economy. The prior Thursday, then President-Elect Obama took the lead in a successful effort to ask Congress to release $350 billion in bailout funds; Obama committed to using $100 billion of the funds to help homeowners facing foreclosure proceedings.

Last week, global credit markets demonstrated the clearest sign yet toward a slow recovery since the U.S. Treasury and Federal Reserve launched a massive rescue of the financial system last fall. A total of $41 billion in corporate bonds, the largest amount in nearly eight months, were issued and sold from McDonalds, Fed Ex, and Amgen; collectively.

Yet another indicator to demonstrate the credit markets are beginning to flow was the drop in the interest rate major banks charge one another for 3-month loans. On Tuesday of last week, the rate dropped to a 5-year low. Insurance companies, banks, and credit unions all have money available to make permanent, refinance, bridge, and construction loans on credit quality and stabilized assets nationwide. We will keep you posted…

$6,250,000 Loan Quote for Southern California Office Building

Penstar obtained a loan quote for the cash-out refinance of a 40,000 sq. ft. multi-tenant office building in Southern California. Among the concerns addressed with the lender were short-term leases, high rollover, and significant cash-out although the borrower has owned the asset for 12 years. We worked closely with the lender to document both the borrower's real estate capabilities and significant net worth in order to mitigate any concerns. The loan terms are outlined as follows: 65% LTV, 30-year amortization, a 5 or 10-year fixed term subject to a 1.25 DCR with a declining pre-payment penalty. The 5-year term currently fixed at 6.05%, and the 10-year term would be priced at 6.59% today. The index will float with the actual rate locked at closing. To discuss, please contact Gerald Price at (818) 883-9629 or Price@PenstarAdvisors.com.

Penstar is working with an insurance company who has allocated $750 million for their 2009 originations. The lender will advance loans on stabilized assets nationwide ranging from $2 million to $15 million for class A industrial, office, multi-family, anchored retail, and high-end hospitality. A maximum loan to value of 65% will be offered at the following respective rates: 6.5% on 3-year fixed, 6.75% on 5-year fixed, 7% on 7-year fixed and 7.25% for 10 year fixed: all with 30 year amortization. To discuss, please contact Steven Hamermesh at (818) 883-9609 or Hamer@PenstarAdvisors.com.

30 Day Libor	10-Year Treasury	Prime
0.39%	2.57%	3.25%

Penstar Realty Advisors can be reached at (818) 883-8600 or at our offices located at:
21700 Oxnard Street, Suite 1870, Woodland Hills, CA 91367