The right combination is the key to success. We tailor your project financing to fit perfectly in every respect. Rely on experience, efficiency, and foresight for your projects:

Our range of services includes:

Senior and Junior Loans refer to two types of debt financing in real estate, differing in repayment priority. Senior Loans offer stability and low interest rates but are limited in their amount. Junior Loans complement financing through greater flexibility and higher interest rates, while carrying increased risk for capital providers. Together, they enable complete and efficient financing of real estate projects.

Characteristics & Advantages:

Senior Loan is a senior-ranking loan that is repaid first in case of regular payments or default.

Advantages:

  1. Lower risk: Due to its priority position, repayments are more secure.
  2. More favorable terms: Interest rates are lower since the lender’s risk is limited.
  3. Stability: Often granted by banks or institutional investors, providing a solid financing foundation.

Junior Loan is a subordinated loan that is only repaid after all senior loan obligations are met.

Advantages:

  1. Financing supplement: It fills financing gaps that cannot be covered by the senior loan alone.
  2. Flexibility: Often less strict conditions and more individualized agreements.
  3. Higher returns: Junior loans offer higher interest rates to capital providers due to the greater risk.

A Whole Loan is an indivisible loan granted directly from the lender to the borrower, without securitizing or selling it to investors. Whole loans are ideal for customized financing of individual, larger real estate projects. Benefits include flexible terms, direct communication, and a stable relationship. Possible drawbacks include limited liquidity and potentially higher risks for the lender.

Characteristics & Advantages:

Senior Loan is a senior-ranking loan that is repaid first in case of a default scenario.

Advantages:

  1. Direct origination: The loan remains fully owned by the original lender (e.g., a bank or other financial institution).
  2. No securitization: The loan is not converted into securities (e.g., mortgage-backed securities) for trading on capital markets.
  3. Individual structuring: Terms such as interest rate, duration, and repayment modalities can be tailored specifically to the borrower’s needs.

For the borrower:

  1. Flexible conditions: Lenders can often negotiate more individualized terms for whole loans, as no standardized requirements (as with securitized loans) need to be met.
  2. Stability: The loan remains with the original lender, making the lender-borrower relationship more stable and personal.
  3. Direct communication: Decisions or changes (e.g., in repayment structure) can be discussed more easily since fewer parties are involved.

For the lender:

  1. Control over the loan: The lender maintains full control over the financing and need not adapt to market demands (as with securitizations).
  2. Long-term returns: Whole loans offer continuous income through interest payments over the term of the loan.
  3. Risk assessment: The lender can directly evaluate and manage the risk rather than relying on standardized models or external ratings.
  4. Limited liquidity: Compared to securitized loans, whole loans are less liquid, as they cannot be sold as easily.

Mezzanine capital is a hybrid form of equity and debt. It preserves the developer’s equity, offers flexible terms, and does not grant the capital provider any voting rights in the project. In return, capital providers benefit from high returns and a secured but subordinated position. It is an attractive solution to close financing gaps and implement projects efficiently.

Characteristics & Advantages:

For the developer/borrower:

  1. Preservation of equity: Less of one’s own capital is needed, increasing the return on equity.
  2. Additional financing option: Enables projects that might otherwise fail due to equity requirements.
  3. Flexibility: Terms can be tailored, and repayments are usually subordinated.
  4. No loss of control: Mezzanine capital providers receive no voting rights or influence on the project’s operations.

For the capital provider:

  1. Higher returns: Compared to traditional loans, mezzanine capital offers higher interest rates and the possibility of profit participation.
  2. Secured position: Although subordinated, there are often securities such as silent partnerships or subordinated mortgages.
  3. Attractive alternative to direct investments: Provides access to real estate projects without fully taking on the project’s risks.

Preferred equity is a form of equity that ranks between traditional equity and debt. It gives the capital provider a preferred position in distributions and repayments compared to common equity holders, but does not offer a fixed interest rate like debt. It allows the developer to secure more financing without diluting control. For project developers, it enables greater financing flexibility, and for investors, it provides a preferential return structure with attractive yields. It is ideal for projects with moderate risk that need capital beyond what conventional debt provides.

Characteristics & Advantages

For the developer/borrower:

  1. Flexibility: Preferred equity can be adapted to specific project needs without increasing the debt ratio.
  2. Equity replacement: Reduces the need to inject one’s own capital, thereby increasing return on equity.
  3. No loss of control: Unlike traditional equity investors, preferred equity investors generally have no voting rights.
  4. Closes financing gaps: Can be used to fill gaps not covered by debt or mezzanine capital.

For the capital provider/investor:

  1. Preferred distributions: Preferred equity investors receive distributions and repayments before common equity holders.
  2. Higher returns: Offers higher returns than debt due to greater risk.
  3. Lower total loss risk than common equity: Due to preferred status, the risk is lower than that of common equity.
  4. Attractive hybrid solution: Combines elements of security (through preference) with the potential for attractive returns.

Joint ventures enable partners to realize larger, more complex projects by pooling resources and sharing risks. Developers gain capital and expertise, while investors benefit from attractive returns and access to professional management.

Characteristics & Advantages

For all participants:

  1. Shared risk: Risks like construction delays or market uncertainties are divided among the partners.
  2. Pooled resources: Partners contribute complementary strengths such as capital, technical know-how, or market access.
  3. Larger projects become feasible: A joint venture allows financing and development of larger projects that one partner alone might not handle.
  4. Economies of scale: Synergies can reduce costs, for example through shared expertise or access to more affordable construction resources.
  5. Market access: Local partners can provide regulatory knowledge and networks, making entry into new markets easier.

For developers:

  1. Capital raising: They can secure financial resources from investors without taking on debt or relinquishing control.
  2. Risk mitigation: Risks such as financing shortfalls are cushioned by the partnership.

For investors:

  1. Higher returns: By participating in the project’s success, investors can achieve above-average returns.
  2. Professional management: Developers or experienced project partners take on operational responsibility.

Benefits for You:

• Access to innovative financing models and exclusive market opportunities.

• Expert knowledge for optimal financing strategies.

• Straightforward execution through an excellent partner network.