Need to Bridge the Gap Between Equity and Senior Debt? Mezzanine Finance Can Help
When a development project needs more funding than senior lenders are willing to provide, mezzanine finance offers a smart solution. It’s a flexible form of funding that sits between senior debt and equity—helping you move ahead with confidence, without giving away more control than necessary.
Funding That Strengthens Your Capital Stack
Mezzanine finance can be used to boost your borrowing power and reduce the equity contribution required from investors or developers. It’s particularly useful in medium-to-large-scale developments where senior lenders cap their exposure, but the project still has strong fundamentals.
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How We Help You Secure Smart, Strategic Funding
We help you assess whether mezzanine finance is the right fit for your project—and source competitive terms that align with your risk profile, timeline, and return strategy. Here’s how we work with you:
1
Understand your funding structure and goals
We assess your capital requirements, senior debt arrangements, equity contributions, and projected returns—ensuring mezzanine finance supports, rather than complicates, your overall structure.
2
Access specialised mezzanine lenders
We work with lenders who understand the complexity of development finance, and who can provide tailored mezzanine solutions for projects at various stages.
3
Ensure alignment with senior debt
We collaborate with your senior lender and legal advisers to ensure the mezzanine facility is structured in a way that complements the first mortgage and meets all intercreditor requirements.
4
Assist with due diligence and legal coordination
We support the preparation of key documentation—including project feasibility, valuation reports, and security arrangements—to meet lender conditions.
5
Plan for repayment and project exit
Whether you’re repaying from settlements, refinancing, or staged equity releases, we help align your mezzanine facility with your exit strategy to avoid pressure near project completion.
Where Mezzanine Finance Adds Value
We assist with mezzanine funding across a range of development scenarios, including:
- Residential and townhouse developments
- Mixed-use and multi-stage projects
- High-density and inner-city builds
- Projects with capped senior debt limits
- Developers seeking to retain more equity or reduce external investors
- FAQs
Common Questions About Mezzanine Finance
What is mezzanine finance used for?
It’s typically used to fill the gap between senior debt and equity on development projects—helping developers reduce upfront capital requirements or take on larger projects.
Is mezzanine finance secured?
Yes. It’s usually secured by a second mortgage or other subordinated security behind the senior lender, and may include personal or corporate guarantees.
What are the typical loan terms?
Loan terms range from 6 to 24 months, depending on project duration. Interest rates are higher than senior debt due to the increased risk and subordinated position.
How is repayment structured?
Repayments are typically made at the end of the loan term, often from project proceeds, refinancing, or equity injection.
Can mezzanine finance be used with private or non-bank lenders?
Yes. Mezzanine loans are often structured in coordination with both bank and non-bank senior lenders. We help ensure compatibility between all parties.
Let’s Talk About Your Capital Strategy
Mezzanine finance can be a powerful tool to enhance project viability and reduce capital strain—if structured the right way. Whether you’re scaling up or bridging a funding shortfall, we’ll help you explore your options and negotiate terms that work. Book a no-obligation consultation today and build a stronger capital foundation for your next development.
