Mezzanine Financing Real Estate
We’re a nationwide provider of mezzanine financing for real estate transactions. At Clopton Capital, we’ve established lasting relationships with a wide specializing network of mezzanine financing providers and private equity firms to give you our time-tested full market approach when you’re searching for the best financing available.
Our mezzanine financing guidelines are:
- Sizes from $1 million to $25 million (total capitalization no limit)
- Nationwide geography
- Property must be commercial
- Typical transaction types are acquisition, recapitalizations, and construction
- Cost of capital scenario based, market competitive
Mezzanine loans are higher capital structures than a typical first mortgage and are secured by either a subordinate lien on the real estate or an interest in the owning entity. Mezzanine financing offers sponsors an alternative to traditional capital structures and give owners the ability to reduce their out-of-pocket costs and increase returns on contributed equity.
Mezzanine financing is typically used for acquisitions, developments, restructuring, and for recapitalizations of existing assets. These loans are subordinated debt and typically customized in some way for each scenario and can have a variety of terms, amortization, and cost.
Call 866-647-1650 or use the Contact Us form to talk to a broker and arrange a subordinated mezzanine loan or other real estate finance for your project. Our mezzanine financing real estate specialists are ready to help with no obligation.
Clopton Capital is a nationwide commercial real estate capital company, mortgage brokerage, and diversified mortgage banking firm. We specialize in commercial mortgages, commercial bridge loans, commercial real estate loans, and institutional real estate private equity for transaction sizes ranges from $1 to $40 million from the secondary market. The commercial mortgage lenders at our company bring long lasting relationships with mezzanine financing real estate capital providers from private equity funds that give our clients deep insight and superior execution.
Examples of Mezzanine Financing For Real Estate
Example 1) A borrower with investors came to us needing mezzanine debt lending because he was looking to acquire an apartment building in Washington, but wanted to use part of his existing equity in buildings he already owned as collateral for the down-payment, without having to refinance his first liens on his existing properties. Local banks could not lend into these types of strategies and don’t have the flexibility needed, despite the loan to value ratio. We were able to structure a $3 million mezzanine loan that was secured against his existing portfolio and the new building without refinancing or disturbing the exiting lender on his portfolio or the new lender on the acquisition asset. Once the new property was under control, the owner was able to refinance the entire capital structure and borrow the entire amount with a new first mortgage, secured by all of his properties with an attractive interest rate.
Example 2) A borrower looking to invest in and acquire a large retail center in Mississippi was looking for max leverage, long term fixed rate, and 30 year amortization debt financing. We were able to structure a two mortgage loans, the first mortgage loan up to 75% LTV, with a small mezzanine financing real estate piece that got the borrower additional loan dollars up to 80% loan to value, requiring less equity investment. Both of the loans, senior debt and mezzanine capital, were delivered to the borrower in conjunction and as one financing structure, allowing simplicity for his closing and servicing going forward.
Example 3) An investor and borrower with 3 retail centers in Illinois with pending foreclosures came to us looking for help structuring debt capital for a refinance and bail out. The issue was that the borrower needed 80% loan to value across the assets and enough time to sell them to pay off the loans and to move quickly. We were able to structure first mortgage bridge loans along with small subordinated loan mezzanine financing from our capital partners to get the cap stack up to 80% loan to value and payoff the existing lenders. The properties did not fully debt service the mezzanine loans, so there needed to be interest reserves structured and created to pay the interest while the borrower put the properties up for sale.