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High Leverage BSP
Ultra High-Leverage Participating Program
Ultra High Leverage Loans For Multifamily
When you start developing massive projects, a couple of percentage points on leverage can make or break a deal. For example, developing a $50M multifamily property at 80% LTC (a solid, high-leverage loan) still means you need to come up with $10M of equity on your own!Even if you've been a developer for many years, bringing $10M "cash to close" is a tall order.Luckily, one of our best capital sources has told us they're putting out terms for multifamily developments at 95% LTC. Now that same $50M example above quickly changes to you only needing to bring $2.5M cash to close!Let that sink in. How many more projects could you develop if you only needed to raise $2.5M versus $10M per project?This high leverage program is called a Participating Mortgage Program, which means that the group requires an equity kicker to max out the leverage. However, it's important to note that the borrower retains 75-95% ownership of the property vs the typical 10-35% with a JV equity structure. They also do not have equity-like control, or voting rights. The borrower must "buy them out" when the loan is paid off (or distribute proportionally upon sale).As if all that weren't incentive enough, this group is a "one-stop-shop" for your financing needs. You can go from a high-leverage ground-up development all the way through to CMBS perm takeout with little to no brain damage. We can't sing this groups praises loudly enough. Here's a detailed look at their numbers.
Loan Size:
$40M Min
$250M Max
LTC: 90-95%
Interest Rate: SOFR + 750 bps
Drops to SOFR + 550 bps I/O at CofO
Fees: 1% Origination, 1% Exit
Exit fee waived if same group provides takeout
Term: up to 5-years
Min Interest: 12 months
Equity Kicker: 10-25% with a return floor based on sponsor projections (no voting rights).
Property types: Multifamily preferred
Other major food groups considered at lower leverage
Non-recourse with bad-boy carveouts
Geographics: Nationwide
If you have a multifamily deal and you want high leverage, click the button below or shoot us an email and let's get started today!
P.S.
If you're brand new to the EN Capital newsletter; each week we promote a new capital source for a variety of commercial real estate properties. So if the above lender is not relative to you, the chances are high that we'll have the perfect capital source for you soon.
P.P.S.
EN Capital is a commercial real estate mortgage brokerage shop.
We are not direct lenders. Seriously, every time we do a blast some guy responds and gets pissy when he realizes we're brokers. It's on the top of our website, LinkedIn, clear in all our marketing. We honestly don't know how to make it more obvious. Don't be that guy.
P.P.P.S.
If you have a commercial real estate deal, unrelated to the above, that needs capital right now reach out to us and let's chat!
Be sure to connect with EN Capital on Linkedin. and visit our website here.
Connect with EN Capital President, Nate Whigham on Linkedin Here
Connect with EN Capital Associate, Justin Ashcraft on Linkedin Here
Nathan WhighamPresidentCA DRE Broker License: 01793655EN Capital Contact Info:www.encapital.com[email protected]Justin Direct Line: 323-521-4766