Debt & Equity Financing
Lee & Associates Commercial Real Estate Finance Group is one of the most experienced and creative capital market teams in North America. We bring to each engagement a perspective and vision uniquely aligned with our client’s needs and expectations. The Group is committed to providing a full array of financial services including debt financing, equity placement, structured finance, recapitalization strategies and CRE advisory services for our commercial real estate clients. In addition to delivering the optimal capitalization structure for our clients’ investment, development, and financing needs, our team provides analytical and market-specific support services to enhance our clients’ decision-making process.
In today’s ever-changing debt market, it is imperative for an intermediary to provide real time, accurate information to the client. The Structured Finance/ Capital Markets Group, with years of active interface with every type of debt source, provides the most current comprehensive information on rates and of execution. The Group’s proprietary database includes local, regional, national and international banking institutions; life companies; pension funds; bridge, construction and mezzanine lenders and direct access to the CMBS market and special situation lenders. We pride ourselves on underwriting both the structural needs and financial objectives of our clients and approach only those lending institutions that will help our clients achieve their investment expectations through a market debt structure competitively bid.
With expertise in office, industrial/flex, multi-family, healthcare, senior housing, retail, mixed-use and specialty assets, we consistently deliver the optimal financing and capitalization structure regardless of product type. We welcome the opportunity to assist clients in achieving their investment goals and objectives.
EQUITY PLACEMENT SERVICES
The Structured Finance Group’s transactional and advisory experience has resulted in relationships with leading equity capital providers both domestic and foreign. These relationships have allowed the Group to present a variety of equity options to our clients for acquisition and development throughout the US. Engagements have included residential development, programmatic joint ventures, union equity fund investments, private equity placement, preferred equity sourcing and creative off-shore co-investment s. Our continuous equity placement activities allow us to keep our clients updated on investor appetite, asset class focus, underwriting parameters and joint venture structure.
- Entity Level Investments
- Family Office
- High Net Worth Investors
- Institutional Joint Ventures
- Preferred Equity
- Foreign/Sovereign Wealth Funds
DEBT PLACEMENT SERVICES
In today’s ever changing debt market, it is imperative for an intermediary to provide real time, accurate information to the client. The Structured Finance/ Capital Markets Group, with years of active interface with every type of debt source, provides the most current comprehensive information on rates and spreads, term, leverage, structure and most importantly, ease and speed of execution. The Group’s proprietary database includes local, regional, national and international banking institutions; life companies; pension funds; bridge, construction and mezzanine lenders and direct access to the CMBS market and special situation lenders. We pride ourselves on underwriting both the structural needs and financial objectives of our clients and approach only those lending institutions that will help our clients achieve their investment expectations through a market debt structure competitively bid.
- Permanent Mortgage Financing
- Bridge Financing
- CMBS Financing
- Construction Loans
- Mezzanine & Preferred Equity
- Debt Recapitalization
- Discounted Pay-Off (DPO)
- Land Loans
Our underwriting procedure includes several important steps:
- Review and analyze the asset’s past operating performance and near-term projected performance
- Recommend a capital structure that best suits the asset and the client’s objectives
- Create a comprehensive underwriting package that is lender-friendly
- Identify potential lenders with investment targets that match the recommended capital structure
- Competitively bid the debt package to targeted lenders
- Review and recommend the bids that are most favorable to the client’s objectives
- Manage the due diligence process
- Negotiate and close the loan transaction
ADVISORY AND ASSET MANAGEMENT SERVICES
The Group offers a comprehensive range of advisory services developed through direct experience as transaction brokers, advisors, underwriters, asset managers and capital facilitators. Our track record of success in the development and implementation of strategies for our clients through the identification of risk, the exploration of alternative investment strategies and the formulation of optimal, sensible and achievable solutions.
In concert with ownership, the asset manager is responsible for developing and executing the investment strategy for the asset. The asset manager oversees the property manager and works closely with other professionals to assure the success of the investment.
- Hold / Sell Analysis
- Portfolio / Property Valuations
- Development Project Proformas / Return Analysis
- Financing Strategies
- Acquisitions Underwriting
- Purchase and Sale Due Diligence
- Market Studies
Asset management services include:
- Establish property goals and develop a property strategic plan
- Annual budgeting, planning and valuation
- Cash management and reporting
- Investor communications
- Public relations and crisis management
- Oversight of property management
- Engaging professionals
- Compliance with regulations
Floating and fixed rate amortizing debt arranged through commercial banks, life companies, pension funds and savings banks to finance stabilized assets of all product types, with typical maturities of five, seven and ten years.
LIBOR based interest rates, no amortization, flexible term plus extensions consistent with specific development timeline of the project. Ground-up, substantial rehabilitation or change of use projects. Interest reserves built into the loan structure eliminating any future equity requirements for the Borrower.
LIBOR based, multi-draw, interest only interim loans for acquisition or renovation of existing assets. Provisions for additional loan draws predicated on “Value Creation” activity are commonplace. Reserves are created to minimize or eliminate additional equity investment by the Borrower during the loan term.
Fixed rate, long term mortgage alternative to traditional permanent mortgages. This type of financing is best utilized for high quality assets or portfolios with strong, sustainable cash flows for the life of the loan.
Financing for the Borrower looking to increase leverage to 90% or 95% of asset value. As this financing is subordinate to the first mortgage, an inter-creditor agreement is necessary to secure the second positions legal rights. Interest coupon may reach the mid-teens depending on the specifics of the transaction and the term never exceeds that of the first mortgage maturity.
This may be as simple as replacing a maturing mortgage loan or warranted due to a significant change in the property profile necessitating a different loan structure to match the current needs.
There may be circumstances when a lender is willing to consider a loan pay-off for less than is owned. In these situations, it is preferable to have an advisor/intermediary experienced in such transactions to represent ownership in the negotiation of terms most advantageous to the ownership.
Often in anticipation of a future development project, land must be owner by the developer prior to the commencement of the entitlement process. Advisory expertise is not only needed to identify potential lenders, but to provide appropriate information to the perspective lender to insure for the developer a successful loan commitment.