[IMGCAP(2)]Katz, who negotiated the deal, notes that the loanwas rate-locked at application for 90 days and closed "well withinthat time frame." The borrower was Los Angeles-based CenturyQuality Management, which is a long-time owner of the sixproperties, where occupancies average in excess of 90%.

Cash-out loans are "extremely uncommon" in today's market,especially a cash-out of this size that is accompanied by a partialinterest-only period, Katz points out. He says that what made thelender comfortable with the deal was a combination of theborrower's qualifications and the quality of the apartmentcomplexes, which Katz describes as stabilized assets in goodlocations. The properties include two in Torrance, two in Resedaand one each in Long Beach and Covina.

Borrowers' qualifications have become much more important intoday's lending environment than they were when the market was hot,Katz points out. In the case of Century Quality Management, hesays, the company is a long-term owner that has investedsubstantially in maintaining and upgrading the properties, has anextensive in-house management and leasing operation and has anextensive track record in the business.