News & Deals

HENDERSON, NV (June 20, 2015) - Helvetica funded a quick bridge loan to enable the borrower to purchase an unstabilized, non-performing self-storage facility in Henderson, NV.  The property provided no debt coverage and the borrower was unable to satisfy guidelines of a bank or traditional lender.  

 The Story

Helvetica was approached by a national commercial real estate brokerage firm in search of a bridge loan for one of their clients. The borrower was purchasing a self-storage facility in Henderson, Nevada and required a quick closing. The property had been severely mismanaged, was unstabilized and under performing.  There was insuffficient debt coverage to meet the requirements of tradional bank guidelines.  The borrower had a definitive plan to make improvements to the property and stabilize the asset. The borrower executed a similar plan on a comparable property in the same market, so Helvetica was confident they could repeat that success. Through great coordination with the brokerage firm, Helvetica was able to quickly provide the borrower with an 18 month bridge loan. With Helvetica’s loan, the borrower was able to purchase the property with a term that provided sufficient time to make property improvements and stabilize the asset.  

Alternative real estate investing is an elusive asset class. Identifying, originating and underwriting real estate investments takes time and experience.

Direct Investing in Alternative Real Estate Assets

Traditional brokers and financial advisors rarely direct their clients to these types of assets primarily because their firm cannot custody the investments and as a result, they lose the capital and cannot charge fees on the assets.  It’s unfortunate, but true.  Some advisors, in an attempt at altruism will direct their clients to such investments in a holistic attempt to balance out a portfolio.  Our experience has proven that alternative real estate investments should be a significant part of any balance portfolio. 

CARLSBAD, CA (September 30, 2014) - Helvetica provided purchase financing in 5 days for a fix and flip project in Carlsbad, California.  The sponsors were waiting on a short sale approval lasting over 9 months. Once the sale was approved the sponsor needed to act quickly in order to close on the property. Helvetica was able to provide funding for the project within 5 days of the initial request enabling the sponsors to capitalize on a unique investment opportunity.  In less than 4 months, the sponsors were able to improve and sell the property capturing a profit that exceeded $300,000.  

Helvetica offers fix & flip loans for rehab projects in coastal areas of Southern California and has financed over 500 residential rehab properties valued at over $100 million since 2010.  Experienced borrowers with a good track record will obtain quicker financing and more attractive rates starting at 7.99%! 

TUCSON, AZ (April 20, 2016) -  A repeat borrower approached Helvetica and requested a bridge loan to pay off a maturing CMBS loan on their multi-tenant light industrial building in Tucson, AZ. 

The property had high historical occupancy, until a tenant occupying 51% of the building vacated after 21 years.  Due to the recent high vacancy, the borrower was unable to obtain conventional bank financing. Helvetica was able to step in and provide a $1,450,000 bridge loan to pay off the borrower’s maturing loan. The borrower intends on utilizing Helvetica’s bridge loan to stabilize the property and lease up the remaining vacant space. Helvetica is confident in the borrower's ability to stabilize the property and refinance into more permanent financing. The borrower had been a loyal client and repeat borrower on several other properties. 

If you are a commercial loan broker or a mortgage broker considering small balance commercial loans, a critical success factor when serving your clients, is certainty in your loan closing.  The ability to provide a reliable quote and a timely closing, should be the primary focus of every loan process.  However, several things get in the way of "certainty."  

These 10 easy tips will move your loan quickly through underwriting and make you a superhero in the eyes of your borrower and lender.

Invesitng in alterantive real estate assets, should be a staple in every investors portfolio.  When considering an investment in a real estate partnership or when choosing an investment sponsor, here are 5 key things to consider:

1. What is the sponsor's vested interest; investment in deal?
2. How long is sponsor's track record?
3. How has sponsor performed during a recession or financial crisis?
4. What is sponsor's contingency plan in the event of a downturn?   
5. How is sponsor compensated; performance based?

ARE BANKS BECOMING THE LENDER OF LAST RESORT?

Even with a great story and tons of equity, banks are declining loan applications because of strict guidelines.  

A few reasons a bank will reject a loan:

• Borrower doesn't meet credit guidelines
• Property does not cash flow or meet debt to income requirements
• Property has high vacancy or is being stabilized
• Borrower cannot document income
• Borrower has Insufficient cash reserves
• Borrower has a recent BK or foreclosure
• Borrower has insufficient seasoning for cash out
• Borrower doesn't want a prepayment penalty

Banks are quickly becoming the last choice for borrowers with commercial property.  The difficulty of getting a bank loan is driving many borrowers to alternative loan sources i.e., private money lenders.  And private money lenders are courting these property owners in an effort to gain attractive yields for their investors.