Mezzanine loans are used as subordinated debt to increase leverage and are secured on the entity level against the ownership interest in the property in contrast to a lien on the realty. They fill a gap in the capital structure occupying a position above senior debt instruments. Sometimes if there is a deficiency in the LTV/LTC of debt financing or a disparity between the equity position of the sponsor and the collective debt, mezzanine capital is used to bridge the gap. Possible mezzanine loans terms are: -

Acquisition, refinancing and construction

Multifamily, Retail, Industrial, Mixed Use, etc

80-85% LTV/LTC

Loan Term: 1 - 3 years and/or co-terminous with senior loan

Amortization: Interest Only

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