Capital Spotlight – Highlighting featured capital investors. We regularly publish the detailed criteria of our most unique real estate capital sources.
Whether deal sponsors are focused on industrial, multifamily, or hospitality transactions, flexible bridge loan solutions are often required to capitalize their value-add deals. With no shortage of bridge lenders lending up to 65-75% LTC, sponsors continuously require more flexibility to cover the capital gap up to 85% LTC. While this “gap capital” often manifests as subordinate debt, this single-family office provides a more streamlined solution by originating higher leverage as a single-source senior lender up to 85% LTC (subject to max 75% LTV at stabilization). Extensive experience and comfort in owning and operating real estate affords the lender an ability to underwrite aggressively and reach higher levels of proceeds than the average private capital source. Their check size ranges $5MM to $40MM, targeting light- to heavy-value-add projects. Pricing ranges between 9.0% (for lighter lift projects) up to 11.5% (for heavier value-add and higher leverage projects) with options for both fixed and floating rates. It is important to note that while this lender cannot lend on ground up construction projects, they do fund heavy value-add deals and have an appetite for well thought out conversion projects. Additionally, by avoiding the more crowded top-tier markets, the lender seeks out opportunities in strong secondary and tertiary markets that are often overlooked by your average private lender.
Focus on Senior Bridge (Selectively, Mezzanine and Preferred Equity Investments)
Nationwide with focus on primary and robust secondary markets. Certain tertiary markets with strong market fundamentals may also be entertained.
Multifamily, Industrial, Retail, Office (selectively), Net Lease, Self-Storage, Hospitality
Use of Funds
Value-add Acquisitions, Refinancing & Recapitalizations, Conversions, Lease-Up, Note Purchases, Distressed Situations
Light to Heavy Value-add; excluding Ground-Up Construction.
Experienced sponsors with a strong local presence
Non-recourse with standard “bad-boy” carve outs; subject to industry carveouts
$5MM to $40MM
Loan to Cost / Loan to Value
Up to 85% LTC / Max 75% LTV at stabilization
Interest Rate / Returns
Senior Debt: 9.0% – 11.5% (Subject to leverage, market, and value-add profile.) Subordinate Debt: Mid to High Teens
1 point in, 1 point out
Flexible based on business plan; typically 12-18 months minimum interest
Less than 1.0x DSCR permitted if supported by interest reserves
If Senior Debt: First Mortgage
If Subordinate Debt: Second Mortgage, UCC/Perfected Pledge, or Preferred Equity Units
Intercreditor Requirements / Recognition Agreements
Applicable only in the event of subordinate debt.
Market Standard Deposits
Closing Time Frame
Typically, 30 -45 days; can move more quickly if 3rd party reports are completed
If this capital source may be of interest, book a call to discuss a potential capital arrangement.