Preferred Equity is available for projects in which capital is needed to fill the gap between sponsor's equity and other financing, reducing the at risk sponsor's equity in the project. The preferred equity complements the sponsor's equity and receives priority return on funds contributed at an agreed coupon rate. This is reflective of the position the preferred equity occupies in the capital structure, associated risks of that position and the correspondent compensation required for occupying that position. Using preferred equity in concert with the other components of the capital stack decreases the sponsor’s capital allocation to a project and when structured prudently increases the Return on Investment (ROI); it represents a viable means of using outside equity in real estate transactions for capital risk mitigation while giving up some of the upside in the deal. We have preferred equity providers in our network that are actively sourcing projects for funding.