Higher Leverage Commercial Project Capitalization
For project sponsors who need higher leverage, a combination of debt and equity capital may be the best resources. These scenarios defy generalization and there is no standard deal structure. Each has different terms and conditions that depend on preferences of user and provider. Leverage as high as 90% or higher may be achievable in certain scenarios with strong sponsorship.
Senior debt providers or lenders may not exceed 50-65% of total project capitalization. Equity, subordinated debt and other alternative capital may provide up to 90% or more of total capital stack. Equity providers may expect a return of their capital as well as an IRR waterfall arrangement for cash flow and equity upside (through a capital event like refinancing or sale/transfer.) An IRR watefall model may include IRR hurdles and promote structures, or it can be structured through a traditional split.
For more expedited analysis, send us your pro forma, plans, budget, market and feasibility studies, executive summary, resume, offering memorandum, and any other relevant financial, sponsorship, or project information.
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