Star News

The lead story in last weeks’ issue of Star News suggested that the U.S. Government revisit the ‘bad bank’ strategy of disposing of toxic assets on banks’ balance sheets. Monday was met with news that the Treasury Department intends to expand the Term Asset-Backed Securities Loan Facility, or TALF, to remove assets from the nation’s banks and sell them to a combination of public and private investment groups. Pension funds, endowments, and hedge/opportunity funds would be targeted as potential buyers of the distressed paper. To date, investors have been largely disappointed in the government’s efforts to restore the banks to health, but seem encouraged by the long-awaited announcement of the proposed plan to clear the illiquid paper being held by the banks. Investment yields would be supported with low interest loans to finance the purchase of the toxic assets; and the government will share the risk should the assets default. We will keep you posted…

Penstar recently received an application for the refinance of a Walgreens Drugstore located in Ohio. The borrower requested maximum loan proceeds. The scheduled NNN income is $495,000, and the lender underwrote the net cash flow to a 1.01 debt coverage ratio with an interest rate of 6.75% using a 25-year amortization: resulting in a loan amount of $5.9 million. To discuss, please contact Steven Hamermesh at (818) 883-9609 or Hamer@PenstarAdvisors.com.

Penstar identified a lender actively closing loans on owner-occupied properties, investor transactions, and hotel/motel properties nationwide. The lender will advance a maximum of 65% loan to value with a 25-year self-liquidating mortgage that is fixed for 5-years, recasting after every 5th year. The interest rate is 350 to 475 over the 5-year swap rate. Prepayment is a step-down structure, opened at the end of every 5th year. To discuss, please contact David Stepanchak at (818) 883-9611 or DStep@PenstarAdvisors.com.

Helpful Humor

We at Penstar understand the challenges of the commercial real estate business. The best antidote for those challenging transactions is to take a moment to have a hearty laugh. Helpful humor is our way of infusing laughter into your work week. The anecdotes may not all be real estate themed but we hope you will enjoy them just the same.

The Millionaire and his Daughter

During a huge party to marry off his daughter, a millionaire announced, ”My dear guests, I have a proposition to every single man here. I will give one million dollars or my daughter in wedlock, to the man who can swim across my backyard pool of alligators and emerge unharmed!”

As soon as he finished his last word, there was a large splash in the pool. A young man was in the pool, swimming with all his might. The crowd cheered him on until he made it to the other side of the pool unharmed by any of the alligators.

The millionaire was impressed and responded:“hat was incredible! Fantastic! I didn´t think it could be done! Do you want my daughter in marriage or the one million dollars?”

The swimmer caught his breath then replied, “I don´t want your money! I don´t want your daughter! I just want the bastard who pushed me in the pool!”