Mezzanine development finance or Mezzanine loan provides a second layer of debt finance (debt with a 2nd position lien also known as Junior Mortgages).

It is provided to bridge the gap between the level of senior debt finance (typically going up to 60%) and the developer’s or the investor’s equity investment into the project or the purchase; a second charge usually secures it.The Mezzanine piece size is typically between 20%-30% of the loan value. Mezzanine development finance reduces the burden on current cash flow and thus helps the project sponsor to manage his finance as well as his actual liquidity.

We concentrate on the entire lifetime of the project from the beginning till the end and focus specifically on the timing that the finance is needed.

The mezzanine loan is easier to manage. In most of the loan agreements the mezz piece can be paid or regularly or by rolling up to the loan balance and being paid at the end of the project after the capital loan, it reduces the burden of the ongoing cash flow during the project life.

It is important for the borrower to be able to make a professional comparison, among all the lenders that offer mezzanine loans.
Not all the mezzanine loans are the same and have the same conditions, however, above all there are issues like flexibility and customer service that you cannot measure them with numbers, but only from your personal experience.