Senior debt is the first level of liability to a project which means it is paid out first, ahead of all other lenders. Typically this is the position that the banks will take.
Mezzanine debt or mezz debt is a form of hybrid capital which can be structured as either preferred equity or unsecured debt. It is generally referred to the layer of debt that sits between senior debt & equity.
If structured correctly the main advantage of Pref Equity vs Mezzanine Debt is that Pre Equity does not require a registered 2nd mortgage or a deed of subordinated of debt to be negotiated by senior lenders such as banks.
Pref Equity is a form of hybrid of debt and equity financing used to fill the gap between what the Bank will fund and what the borrower is able to contribute towards the Total Developments Costs (TDC) of a project. Pref Equity financing can give the Pref Equity provider the rights to convert to an ownership and control [...]
Why not get your project started now? With our pre-sale underwriting guarantee you in place you can start construction immediately and decide to sell when the timing is right for you. Imagine being able to secure your profit on your project before you start? That’s right, where else can you get that?
As banks continue tightening lending to foreign buyers, developers with exposure to settlement risk has increased dramatically since the beginning of 2016. Banks have adopting a cautious approach lowering their loan value ratios and adopting stringent documentation rules. If you have foreign purchasers, we have access to alternative lender sources.