Google says, “Mezzanine financing is basically debt capital that gives the lender the rights to convert to an ownership or equity interest in the company if the loan is not paid back in time and in full. It is generally subordinated to debt provided by senior lenders such as banks and venture capital companies.”
Well… mezzanine finance is a type of subordinated debt after senior debt in terms of ranking on any claim on property assets; and prior to equity, usually secured by a second mortgage.
The mezzanine loan is very much like a second mortgage with a big difference. Instead of being secured by the actual real estate property, mezzanine loans are secured by the stock that the company, which owns the real estate, possess.
A mezzanine loan is generally acquired for a large project such as a large shopping center, shopping mall, an office tower, hotel, industrial park, or apartment complex. Mezzanine loans are hefty mortgages that cover millions of dollars of debt. Besides, mezzanine lenders are often experts in the type of loans they offer.
GCC Business Finance is one such a reliable mezzanine finance lender that understands the financial requirements large projects. We have more than a decade of experience in mezzanine financing. Our financial curriculum is tailor-made according to the needs and requirements of our clients.
Of course, we gain significant benefits from Mezzanine Finance –
Investment is secured by property
Fixed term investment
Only those projects which are all set for immediate construction are eligible
We properly scrutinize the property developers’ capacity, capability and track financial record
We verify the projects properly
Our main objective is to provide appropriate and responsive solutions to our borrowers’ financing needs. We don’t waste our client’s precious time. Get in touch with us today!!
Resources: http://www.globalcapital.com.au/development-finance/mezzanine-finance-preferred-equity/
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