Capital Spotlight – Highlighting featured capital investors. We regularly publish the detailed criteria of our most unique real estate capital sources.
Alternative Investment Firm Originating $5MM to $30M Preferred Equity Checks up to 85% LTC for U.S. & U.K. Construction Projects.
This prominent alternative investment firm specializes in originating $5+ million preferred equity and mezzanine debt investments for select European family offices. Primarily targeting value-add real estate ventures and developments along the East Coast, their investment scope extends to multifamily, industrial, retail, and mixed-use projects. The firm’s key strengths lie in its leverage capability and rapid transaction processing.
Backed by a history of LP investments, the firm demonstrates robust confidence in assuming equity-like risks, particularly when supported by strong sponsorship and deal metrics. With a lean deal team, they boast an impressive ability to deliver term sheets within a week and finalize deals within 2-3 weeks, facilitating swift closings.
Capital options range from non-recourse sub-debt checks spanning $5-30 million to whole loan solutions from $10-60 million. Proceeds can be tailored up to 85% LTC, with pricing for subordinate capital typically falling between 14.0% – 16.0%, accompanied by a 1.0% origination fee and a 1.0% exit fee. Their whole-loan solutions are typically floating, ranging from SOFR + 500-700.
What sets this investment group apart is its adaptable and agile investment approach. Leveraging their equity backgrounds and flexible mandates, they can customize structures to align with project requirements, provided the sponsor demonstrates adequate experience and the deal offers a compelling return profile.
Capital Type | Preferred Equity, Mezzanine Debt, Senior Bridge, Selectively LP |
Geography | Nationwide U.S. (Preference for primary, strong secondary, and strong tertiary markets), U.K. |
Property Types | Multifamily, Condos, Industrial, Retail, Office (selectively) |
Use of Funds | Acquisition, Refi / Recap, |
Construction | Light to Heavy Value-add; Ground-Up Construction (Focused on Strong primary and secondary markets). |
Sponsorship | Require sponsors with similar deal experience to the subject transaction |
Recourse | Non-recourse (willing to entertain additional collateral) |
Check Size | Pref Equity or Mezz: $5MM to $30MM |
Loan to Cost / Loan to Value | Up to 85% LTC (Typically 80% LTC for Construction and selectively higher subject to target debt yields) |
Interest Rate / Returns | Pref Equity / Mezz: 14.0% – 16.0% |
Origination Fees | 1 point in, 1 point out |
Term | 24 – 36 Months + extensions |
Prepayment Structure | 12 months min interest |
Underwriting Requirements | Typically 7.0% – 8.0% Stabilized Debt yield subject to asset class and location |
Collateral Requirements | If Senior Debt: First Mortgage |
Intercreditor Requirements / Recognition Agreements | Recognition agreements required |
Deposits | Market Standard Deposits |
Closing Time Frame | Can close in 2 weeks if 3rd parties are already completed. Typically 3-5 weeks. |
If this capital source may be of interest, book a call to discuss a potential capital arrangement.
Read our last Capital Spotlight: Capital Spotlight: PE Fund Stays Active, Making $1-30MM LP Investments with Local Value-Add Multifamily Operators