Preferred Equity
It can sometimes turn out to be a challenging task to get the right amount of money and types of commercial property financing needed to complete a cycle. Among other financing options, preferred equity is the most common and potential solution available for investors, real estate developers, and sponsors. Using preferred equity finance in Australia can help investors and developers in developing a commercial project easily.
What is preferred equity?
It is a form of equity that can be designed for a commercial real estate project as a way to invest. It strikes a balance between common equity and senior debt. It generally sits in the middle of the capital stack so it can be structured to look similar to common equity or to debt. Investors and sponsors get the flexibility to structure preferred equity in a creative way, which is the beauty of this type of investment.
Without any doubt, it can be said that securing the finance is the most vital part of any property development project. You should be open to a combination of funding solutions from a wide range of financiers when you want to get the best chance of securing finance for your next property development project in Australia. We, at Commercial Construction Loans, provide a range of funding solutions to commercial real estate developers, investors, and sponsors in Australia. One of the most common funding we provide is preferred equity. We have built a strong reputation with property developers and real estate companies. We have the right experience, skills, and connections to help developers and sponsors solve finance problems.
Understand the working method of preferred equity finance
Before getting into submitting the application for preferred equity, you must be aware of the working criteria of this financing option. The best method to understand preferred equity is to make a comparison with other kinds of development finance options available in the market.
When you get a traditional debt finance loan, you repay the principal along with interest. But when you think of getting a preferred equity finance loan, you need to repay all or some of the principal amount. Along with that, you need to pay interest and also agree to give a stake to the lender in your property development project, when it comes to preferred equity finance.
With this financing option, borrowers need to give a lot away to the lending companies. But if it is the only method in front of you to secure funding, its price may appear worthy to you.
Highlights of preferred equity finance
• Repayment of some or all of the principal amount
• Paying interest
• Surrendering a stake in your property development project
Why Commercial Construction Loans for Preferred Equity?
Are you seeking the best and most reliable place to get preferred equity finance in Australia? Then, Commercial Construction Loans offer you genuine solutions for preferred equity. We have a huge lender network in Australia, with which we arrange personalized equity funding for real estate property developments as well as asset repositioning opportunities. We are the #1 finance lending provider for commercial properties in Australia. You would be amazed to check out the benefits of using our guidance for preferred equity finance, including:
• Several years of industry trust and experience
• Professional advice and guidance during any transaction
• Greatly experienced and diligent in funding complex projects
• Exclusively experts in commercial property finance
When would you look for a preferred equity loan at Commercial Construction Loans?
• If you have insufficient equity available for the development project
• If you are an experienced property developer with a good track record
• If you want to retain equity for some other opportunities
• If your property development projects are well de-risked by preleasing or presales
In any of these scenarios, you can talk to us to secure a preferred equity loan option for your property development project in Australia. Contact us now.