ATLANTA—It wasn't that long ago when folks weren't sure how long it would take the capital markets to recover from the real estate meltdown. In recent years we've seen new players come to the table with cash on hand to loan.
The latest effort comes from Franklin Street Capital Advisors (FSCA). The firm just launched what it's calling a proprietary small-balance mezzanine loan program. FSCA will offer direct mezzanine loans and claims a specialty in placing first mortgage debt and equity solutions.
“With the amount of CMBS debt maturing during the next couple of years, we saw an opportunity to provide sophisticated investors a solution in the event of a refinance shortfall,” Danny York, president of FSCA, tells GlobeSt.com. “There are very few institutions providing small balance mezzanine loans. Our platform and infrastructure allows us to provide this type of product, where others may be unable to.”
FSCA is looking to offer mezzanine loans for all commercial real estate asset classes, but will emphasis on multifamily and retail real estate in the Southeast. The small balance mezzanine loan program features loans of $500,000 to $5 million with terms of three to five years and interest rates of 12% to 15%. Specific terms, of course, depend on the quality of asset, the sponsor, the loan-to-value ratio and the debt-service coverage ratio.
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