For established developers with consistent needs for capital, Blue Cardinal offers equity and mezzanine debt facilities. A facility provides the developer with a readily available source of cash to supplement their own investment when projects require it. The facility can be accessed as needed and enters the project capital stack as traditional equity, preferred equity or mezzanine debt as defined by the facility. Each time the facility is used, the Blue Cardinal team underwrites the proposed use to ensure the project conforms to the preset requirements of the fund and that all developer’s covenants are in force.
Equity facilities typically stipulate when the capital can enter into a real estate project such as during acquisition, pre development, development or stabilization. Equity facilities also limit what developers can pay themselves or affiliated parties before investors are redeemed.
Mezzanine facilities provide even greater flexibility and availability of cash. Blue Cardinal Capital Mezzanine Facilities can be structured to meet the unique needs of the developer and are priced to reflect the level of risk that is passed to investors including the likelihood of the facility being fully used.
A number of variables determine the cost, amount and availability of a mezzanine facility including personal guarantees, timing of interest payments, fixed or variable rates, types of projects, percentage of senior debt, history and the life-stage of the real estate.
For more information, contact a Blue Cardinal Business Development Director.
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