Debt
We act for the borrower.
Wraith Real Estate arranges senior and mezzanine commercial real estate debt for sponsors. We prepare the loan request, take it to the lenders suited to the property and the plan, and negotiate the terms through closing.
Commercial real estate loans we arrange
- Construction loansSenior financing for ground-up development and major renovation, funded in draws against a budget.
- Bridge loansShort-term financing for acquisitions, value-add business plans and properties not yet ready for permanent debt.
- Permanent loansLong-term fixed or floating rate financing for stabilized properties.
- Mezzanine financingSubordinate debt between the senior loan and the equity, secured by the ownership interests.
Our role
We are not a lender. We represent the sponsor in the financing: we assemble the loan request, choose the lenders to approach with the sponsor, compare their terms and negotiate on the sponsor’s behalf.
Lenders differ on more than the interest rate. Leverage, recourse, prepayment, reserves, extension tests and covenants can matter as much to a business plan, and they are easier to negotiate while more than one lender is at the table.
How a financing runs
- 01
The loan request
We build the request with the sponsor: the business plan, sources and uses, the budget or operating history, the pro forma and the sponsor’s financial information.
- 02
Lender selection
Lenders are chosen with the sponsor by property type, market, loan size and structure before anyone is contacted.
- 03
Quotes
Lenders receive the request under confidentiality and return indicative terms. We lay the quotes side by side on leverage, pricing, recourse, prepayment, reserves and covenants.
- 04
Term sheet
The sponsor selects a lender, and we negotiate the term sheet and the application.
- 05
Closing
We coordinate the appraisal and third-party reports, answer the lender’s underwriting questions and work with counsel on the loan documents through closing.
What to have ready
Lenders quote on what they are given. Most of what they ask for is material a sponsor already has.
- Sources and uses of funds
- The business plan for the property
- A development budget and schedule, for construction
- A rent roll and trailing twelve months of operating statements, for existing properties
- A pro forma with the assumptions behind it
- The sponsor’s schedule of real estate owned
- Financial statements for the principals and guarantors
- Organizational documents for the borrowing entity
Loan terms depend on the property, the sponsor, the lender and market conditions, and a financing may not close.
Request financing
Send us the property, the business plan and the capital you need. We will tell you how we would approach it.