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Resources

Closing with Preferred Equity Behind a Construction Loan

Preferred equity is not just for stabilized assets; it can fill a gap in the capital stack behind a construction loan as well. Many characteristics of a development deal are similar to those found in a typical acquisition or refinance, but there..

Buying Out an Existing Partner Using Preferred Equity

Often, the common equity in a multifamily deal consists of multiple partners. These equity partners may desire to exit a deal while the remaining partners want to remain. In these cases, the remaining equity partners will need to buy out the..

Recapitalizing an Investment Without Refinancing

There are many reasons a sponsor might decide to recapitalize an existing investment rather than refinance it, such as buying out a partner, reducing overall common equity, or financing a large value-add program without adding more common..

Typical Costs in a Preferred Equity Transaction

A preferred equity transaction, just like a mortgage loan transaction, has typical costs associated with it. Many of these costs mirror those found in a mortgage loan, as well. Though every transaction is different, the most common costs..

Typical Preferred Equity and Mezzanine Organization Structures

Choosing an organization structure within a preferred equity or mezzanine deal is an important step along the way to a smooth closing. Though there are many ways to structure the entities and individuals involved in a transaction, understanding..

Best Practices for Closing a Multifamily Deal with Preferred Equity

Using a preferred equity structure in a multifamily deal has many similarities to a deal without preferred equity. Understanding the key distinctions and requirements when including preferred equity helps the overall diligence and closing process..