What is mezzanine finance?
This type of commercial property finance provides top-up funding for development costs of large-scale projects, meaning that a gap between principle lending and the total cost of a development will not prevent the work from taking place. It is a short to medium term loan, made to bridge a funding gap and get a development moving.
Mezzanine finance is suitable for developers looking to capitalise on an opportunity and to broaden the scope of their property investments, whether through acquisitions, buyouts, or new developments. As a hybrid of debt and equity finance, this type of funding appeals to those who want to retain control while lowering their own capital investment.
How does mezzanine finance work?
This type of funding can seem complex, so let’s break it down. Another lender may have provided 70% of required funds for your property development, while you are able to contribute 10% of the cost upfront. Mezzanine finance can provide the remaining 20% of the costs via a loan in exchange for equity. Because risk is offset with equity, we are invested in your success.
When working with an applicant for mezzanine finance, we combine our knowledge of the property market – and many successful prior developments – with our portfolio of contacts. We aim to partner applicants with the most suitable lender to ensure a smooth and bespoke solution. You are also assured of:
Fixed interest rates and no hidden fees
No early repayment fees
Applications accepted from any industry
Minimal paperwork during application
Freedom to use finance for any purpose